Tax Pros Fear Procrastination, Workload From Filing Extension
Some tax professionals are strongly opposed to the idea of postponing the nation’s April 15 tax return filing deadline.
“I work 100 hours a week until April 15,” said enrolled agent Trish Evenstad of Evenstad Tax & Financial Services Inc. in Westby, Wisconsin, who looks forward to a more normal 35-to-40-hour workweek thereafter. “I would hate to see them extend the filing deadline,” she said.
Delaying parts or all of the tax return filing season has become the talk of the Washington tax community since the coronavirus pandemic took hold of the nation last week. Treasury Secretary Steven Mnuchin said March 11 that the administration is considering the move. “We think we can provide over $200 billion of liquidity into the economy by delaying certain [business] tax payments,” he said.
Also March 11, the American Institute of CPAs suggested giving individual taxpayers until October 15 to file and pay, providing automatic extensions to businesses, and other coronavirus relief. The following day, the National Society of Accountants advocated moving the deadline for filing returns and paying taxes to May 31.
Robert Kerr, executive vice president of the National Association of Enrolled Agents, said the organization is considering sending a letter to the IRS about the April 15 deadline extension.
Besides playing havoc with the work schedules of thousands of tax return preparers, changing the April 15 deadline has an important social component, Kerr said.
“This April 15 [deadline] has withstood many challenges before,” Kerr said. “If we let the April 15 deadline slide, how long is the tax season? . . . Joe Sixpack hears that April 15 isn’t a thing anymore, because there’s not a clear message out there about the deadline or about anything related to the larger issue of penalties or interest. And in the absence of a clear message, people make stuff up all day long.”
“Tax deadlines have this nice way of getting people not to procrastinate” in meeting their annual tax return filing obligation, said enrolled agent David W. Tolleth of Tolleth Tax Advisors in Holmdel, New Jersey.
Like Evenstad, Tolleth said he believes the IRS already has the tools it needs to deal with the coronavirus and the tax season. The IRS should waive penalties and interest for late return filings — and most importantly, Tolleth said, tax payments — to all taxpayers until a given date, he said.
Evenstad rejected the idea that taxpayers could simply file extensions to delay their filing requirement. While an extension delays the filing requirement until October 15, it does nothing to delay the requirement to make or negotiate some payment if taxes are estimated to be due, she noted.
“People get nervous about extensions,” Evenstad added. “They think it raises a red flag to the IRS, and it doesn’t.”
“Pushing [the April 15 deadline] out is just going to make people procrastinate that don’t need to,” Evenstad said. “There are people who are ready to file now, and have no reason not to get their stuff in, but they still have a month,” she said. Postponing the April 15 deadline will only encourage some taxpayers to delay further, she said.
‘Still Have to Get the Work Done’
Brian L. Thompson empathizes with his tax professional compatriots’ attachment to the April 15 deadline. “It’s remarkable the pressure release that happens on April 16,” he said.
But opposition to an April 15 filing season deadline extension is “a bit of a self-serving thing,” said Thompson, a CPA and partner at Bailey & Thompson Tax & Accounting PA in Little Rock, Arkansas. “We would change our workflow so we wouldn’t be doing those 100-hour workweeks.”
Some tax professionals have clients more responsive to changes in tax business practices and deadline changes. Evenstad said her calendar is booked solid from January through April 15. Tolleth said his clients are located up and down both American coasts, and he’s been transitioning to remote service based on customer demand.
Thompson said his schedule is also full, and his office still open, despite local school closings, government office closures, and workforces being dispersed from offices to homes.
“Until we hear about [a return filing season] extension, or something else takes place, we still have to get the work done,” Thompson said.
Tolleth agreed that some certainty from the IRS is in order.
“The work will fill the time you have available,” Tolleth said. “I would rather have filing season end so I can move on to the other parts of my personal and professional life.”