Intuit Community Champion

Question

I dont do many extensions, do I have this right?

Forum|Forum|1 year ago
April 10, 2025
4 replies
13 views

Client is a realtor and made over 200k in 2024, his bookkeeping is kind of a mess and were missing some stuff, in 2023 his total tax liability was $7000.

If he sends an extension with $7000, and then ends up owing another $15k on the return, that extension and payment avoid any penalties for him, right?

ProSeries Professional

IRonMaN

Level 15

Nope.

Slava Ukraini!

abctax55

Level 15

He has to pay what is guestimated as owed WITH the extension to avoid late payment penalties and interest.

The extension is just to avoid late *filing* penalties, not the late paying ones.

HumanKind... Be Both

Just-Lisa-Now-

Author

Intuit Community Champion

Well crap...ok I gotta do some more work then

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

R

rcooley25

Level 7

The extension is and extension of time to file and not an extension of time to pay Lot of people make the mistake and think if they fie and extension they can wait untiel

l Oct. 15th to pay the tax and this is simply not true.

Just-Lisa-Now-

Author

Intuit Community Champion

So it saves him from the failure to file penalty and the estimated tax penalty if he pays in 100% of what he owed last year, but it doesn't clear him from the failure to pay what might be due for 2024.

Saturday morning work is gonna dip onto Saturday afternoon I guess!

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

abctax55

Level 15

If he's last minute dude, don't ruin your Saturday. Guess high, or just let him tell you what he wants to pay.

AND - his first estimate is due Tuesday also. IF he cares.

Word of advice, I usually include the first estimate amount with the extension payment with the anticipation of the overpayment being applied. That way, if the guestimate is wrong, 2024 is covered and only the 1st qtr 2025 estimate is (possibly) low.

HumanKind... Be Both

qbteachmt

Level 15

The Safe Harbor not only has the 90% rule, the 100% rule, the 110% rule. It also has a timeliness requirement. The safe harbor needs to have been paid by any combination of withholding and estimates. Estimates need to be timely. Withholding is considered to be "for the year" and not by quarterly. This is one reason I put seniors with investment income on Social Security withholding, so they can meet safe harbor and not worry about missing estimate due dates.

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