Important Notice Regarding 2012 Tax Return Filings
As you probably are aware, on January 1, 2013, Congress threw taxpayers, the tax professional community and the IRS a curve with the eleventh-hour passage of the American Taxpayer Relief Act of 2012. Because the law contains many provisions that are retroactive to the beginning of 2012, and thus affects tax returns being prepared this filing season, the consequences of this late passage are far reaching.
The IRS, for instance, had to delay issuance of many tax forms and reprogram computer systems to deal with the law. As a result, the IRS didn't begin accepting returns until several weeks after the time it normally begins, and as of this writing there are still several forms the IRS is not yet able to accept. Guidance from the IRS has stated it could be well into March before they are ready to accept all returns.
Each delay by the IRS causes a snowball effect in the tax professional community. Tax software cannot be developed, tested and released until after the IRS issues final guidance and approval of its forms. And, of course, tax preparers such as EGP cannot do our work completely until the tax software we rely on is ready and released.
Complicating this, many brokerage firms have received approval from the IRS to delay sending 1099s to their clients until as late as March 15th. Even then they are saying the 1099s may not be final when sent. We have seen notifications from some brokers that have recommended their clients make plans to file for the IRS allowed automatic extension of time to file tax returns because of these developments.
Our purpose in sending this letter is first of all to thank you for your patience as the issues caused by the compounded delays are worked through. Second, and of major importance to you our valued client, is to let you know as soon as possible that these delays have forced a situation where we will have to file for extensions for perhaps the majority of our clients this year.
For many clients, i.e., those who normally file for an extension and are aware of the advantages of doing so, this will be a non-event. For others who are not used to having extensions filed, we realize this may be a cause of concern, and we welcome the opportunity to explain more fully the process and benefits of extensions. Unfortunately, the circumstances leading to this are beyond our control. We will, of course, continue to work diligently to minimize as much as possible the impact this has on you.
We so appreciate your understanding and regret any inconvenience this may cause. We welcome the chance to discuss how this may affect you, so feel free to give us a call.
