CA Preparers - Are you still going to file a 3/15 extn?

I'm not on their message board. Do you have concerns about the interest?

No.

Wiles, I am sure that you also just received the Spidell email, which summarizes where we are at in plain language.

It says, in part, this:

The automatic extension applies to any and all payments for the listed return types for payments due on or after January 8, 2023, through October 16, 2023, except for payroll tax deposits. The payment extension for payroll tax deposits only applied to deposits due from January 8, 2023, through January 23, 2023, and those deposits were due on January 23, 2023.
In other words, all payments for the return types listed above that were due on or after January 8, 2023, through October 16, 2023, are due on October 16, 2023, without incurring late payment penalties. This includes estimated tax payments and the California passthrough entity elective tax March 15, 2023, payment (for calendar-year taxpayers) as well as the June 15, 2023, prepayment for the 2023 tax year. Retirement plan contributions, including employer contributions, are also extended to October 16, 2023.

The underlined portion made me realize that I don't think I've read anything that says that interest won't be charged. Are we sure no interest will be charged?

No...I am worried about this too, and for the same reason. The IRS did not specifically say they would not charge interest. Maybe they haven't decided yet. Taxpayers may need to wait until returns are filed in October to find out.

I have an elderly client who is trustee for a trust for her even older mother. In 2019, the trust had large cap gains. Trust tax payments go to the service center. My client made her payment on time and had proof of mailing and delivery. The IRS failed to open her payment envelope for over 6 months. The trust got charged interest ($1K+) on the grounds that it had use of the funds while the envelope sat in the stack. Seriously? The rate of interest was far more than this trust (or probably anyone else) receives on a regular checking account. The IRS refused to abate the interest.

My client was not the only one who had this issue.

If the IRS can charge interest in that situation, why not here? The IRS seems to like a good game of "Gotcha".

Yes. I did receive that and saw the same thing.

It's funny because their message board is blowing up with all these questions as if it is Spidell's responsibility to tell us everything. Their Flash email starts off with "This Flash E-mail is meant to clarify, in plain English,...". And you can tell they took their time to try to answer every single question. They even answered some of them twice just to make sure it sticks with the reader.

I just know the message board is now going to start blowing up with "But what about the interest!?!?". They will be shaking their heads.

You are late to the party. The issue of interest was a topic of conversation on the Spidell's message board maybe 5 days ago. I don't think a consensus of opinion was ever reached.

Sounds like I missed a fun party
Did 7508A arrive late?

https://www.irs.gov/irm/part20/irm_20-0 ... 9599929760

And on the FTB side:

https://www.ftb.ca.gov/file/business/de ... -loss.html

Extended deadlines to file, pay, and make contributions
California follows federal extended deadlines
There are extended deadlines for:
Filing tax returns
Paying income taxes
Making contributions to a traditional Individual Retirement Account (IRA) or Roth IRA
Extended deadlines are up to 1 year (See IRS Tax Relief in Disaster Situations)
Interest and penalties are canceled on the underpaid income tax for the length of any extended deadline period

I assume, for those of us that have AZ returns along with CA returns, there is still no "extension" of time for the AZ side. A postponement of the deadline by the IRS due to a disaster is not recognized for AZ income tax purposes, correct?

Hi all,

Regarding the postponed deadline for most CA taxpayers- what are you all doing? Are you still filing an extension for personal taxes and corporation? First time dealing with a postponement due to a disaster, and not sure if IRS will not mess up and send a bunch of unnecessary notices that we have to address later on. Looking to hear thoughts on what most of you do (still file extensions or acting as if deadline was 10/16 and no extension filing)

Also the 4th Q deadline was pushed off to Oct 16- how do you go about making that 4th Q estimate on IRS direct Pay- it does not let you select 2022 estimated taxes anymore- do they count payment with return as 4th Q estimate? what about extension payment if we file an extension?

Thank you all!

Anyone?

Why are you making a 2022 Q4 estimated tax payment? Just include it all when you file the return.

We will be filing blank 4868s or using the best info available if we have it. We intend to extend all.

I am afraid that if we don't make the payment separately for Q4, they will not account for it as a Q4 estimate and reduce the underpayment penalty if any. Also not entirely sure if we process an extension payment if that will automatically qualify as a Q4 payment.

No one taking the route of NOT extending at all? Anyone has experience with postponement in other disaster areas (FL or TX)?

Thanks

We are going to do the same thing we all did for 2020 & 2021

What did you do for 2020 and 2021?

2020 and 2021 was a postponement for ALL taxpayers because of COVID

in our case it only applies to mostly CA.

I am guessing you will NOT be filing extensions?

Correct. For 2020 & 2021, we did not file extns until 7/15 and 5/15, respectively.

For this year, there is no extension to be filed since there is only the single due date.

I just want to clarify that:

For both CA and FED, both the returns AND PAYMENT are due in October? There is no need to prpeare extensions and pay by Apri 17 any expected tax due on the return?

First time dealing with a postponement due to a disaster, and not sure if IRS will not mess up and send a bunch of unnecessary notices that we have to address later on.

There are lots of IRS computer systems that are triggered by the normal APril 18 deadline. Even now most of the country is still working off that due date. IRS may, or may not get things programmed to respect the extended deadlines for that subset of taxpayers. WHo knows? We've seen erroneous letters in the past that create gnashing of teeth for clients, and thus the preparer.

I'm filing 4868 for all clients not completed by April 18, and recommending payment by then as well.

It s programmed based on Zip Codes for the deadline changes.

Also, there has been a lot of disaster over the past few years whether in FL or TX and apparently not been an issue in the past, their system seems to handle it pretty easily, it doesnt mean it's flawless though

Not sure why you all are worrying. IRS said if they send a bill in error just call them and they will fix it! (I jest, I am totally worrying about the potential for problems on this one.)