I believe that the 2012 tax year will have more extensions than normal. First the IRS has delayed the start of the tax year until January 30th. Second W2s are late from Paychex and ADP because of the new rules regarding the reporting of health insurance. So even if I wanted to file individuals today (1/23) I could not.
Business returns are waiting on the IRS for Depreciation, Residential Energy Credit and Business Credit forms until the end of February or the first part of March. Therefore there is just 2 weeks to file S Corp returns and 6 weeks to file partnership returns. Business owners will have to wait until their business returns are filed in order to file their individual returns. So everything is bogged down until the first part of March. Which happily coincides with when I receive round one of the investment statements from brokerage houses. But unhappily this means that an already short turnaround time for me to prepare returns has just been cut in half!!!
Farmer’s traditionally don’t have to pay estimated tax payments if they file their return by March 1st. An important form for farmers is the Form 4562 so they can depreciate their equipment. The IRS doesn’t plan on releasing that form until the same time as the return is due. The IRS has waived the penalty for filing after March 1st if they file and pay the tax by April 15th. They will need to attach Form 2210-F to their return to have the penalty waived.
The IRS has already said that this year refunds will not be turned around in 10 days like last year they are shooting for 21 days. But if Congress doesn’t address the debt ceiling soon I predict that taxpayers will not receive their expected refunds until the issue is resolved. I’m betting that other debtors will be paid before the American citizens. Sort of like the IOUs Californians received a few years ago when CA had no money. Just one more reason that you should plan on owing the IRS at year end. I’ve told clients for years that they should think of owing the IRS at year end as an interest free loan rather than looking at a refund as a savings account. This year just might prove my point. I would far rather owe the IRS $500 in April than have to wait till July to receive $500.