Automatic Extension online filing request gets denied w/ code R0000-052-01 - why?

Question

I am trying to e-file, using the FreeFileFillableForms website, an extension request (F.4868). I have no tax due, and expect a couple of thousands in returns once I file the complete F.1040. Yesterday, I filled the online form, I left the bank account details empty (b/c there is no payment made), and filed the extension.

This morning I got a rejection reply from the IRS, due to:

Issue : Business Rule R0000-052-01 - 'TaxYear' specified in the IRS Submission Manifest must match 'TaxYr' in the Return Header.

Obviously, I did not enter any tax year value, as this is generated by the system. Searching for that code, I found a discussion where one mentions that after the first rejection, he filled up the bank info and added a payment.

So, I tried to re-send the extension, this time filling the bank info, but adding 0 payment. About an hour ago, I received another rejection, with the same code.

I went on and added a $1 payment, submitting for the 3rd time.

Unfortunately, it is too late now to send a paper copy of F.4868, as the postmark date will be of Apr. 16th anyway.

Here's the questions:

1. What is the source for this error and the meaning of the message?

2. How should I fix it?

3. If I do not owe tax, should I expect to pay a penalty b/c I did not submit the request on time (assuming my 3rd attempt fails again)?

---

Update 1: My 3rd attempt, including a $1 payment got rejected once again, with the same error message. My #1 and #2 questions above are still open. Any idea what's wrong?

Answer 1

There are penalties for failure to file and penalties for failure to pay tax. The penalties for both are based on the amount of tax due. So you would owe % penalties of zero, otherwise meaning no penalties at all.

The IRS on late 1040 penalties:

Here are eight important points about penalties for filing or paying late.

1. A failure-to-file penalty may apply if you did not file by the tax filing deadline. A failure-to-pay penalty may apply if you did not pay all of the taxes you owe by the tax filing deadline.

2. The failure-to-file penalty is generally more than the failure-to-pay penalty. You should file your tax return on time each year, even if you’re not able to pay all the taxes you owe by the due date. You can reduce additional interest and penalties by paying as much as you can with your tax return. You should explore other payment options such as getting a loan or making an installment agreement to make payments. The IRS will work with you.

3. The penalty for filing late is normally 5 percent of the unpaid taxes for each month or part of a month that a tax return is late. That penalty starts accruing the day after the tax filing due date and will not exceed 25 percent of your unpaid taxes.

4. If you do not pay your taxes by the tax deadline, you normally will face a failure-to-pay penalty of ½ of 1 percent of your unpaid taxes. That penalty applies for each month or part of a month after the due date and starts accruing the day after the tax-filing due date.

5. If you timely requested an extension of time to file your individual income tax return and paid at least 90 percent of the taxes you owe with your request, you may not face a failure-to-pay penalty. However, you must pay any remaining balance by the extended due date.

6. If both the 5 percent failure-to-file penalty and the ½ percent failure-to-pay penalties apply in any month, the maximum penalty that you’ll pay for both is 5 percent.

7. If you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $135 or 100 percent of the unpaid tax.

8. You will not have to pay a late-filing or late-payment penalty if you can show reasonable cause for not filing or paying on time.

If the IRS owes you a refund, April 15 isn't much of a deadline.

I suppose the real deadline is April 15, three years later - that's when the IRS keeps your refund and it becomes property of the Treasury. Of course, there's little reason to wait that long. Don't let the Treasury get all your interest.