Thank you RobertG. That's an important point.
The IRS instructions for 4868 say the following:
Late Filing Penalty
A late filing penalty is usually charged if your return is filed after the
due date (including extensions). The penalty is usually 5% of the
amount due for each month or part of a month your return is late.
The maximum penalty is 25%. If your return is more than 60 days
late, the minimum penalty is $330 (adjusted for inflation) or the
balance of the tax due on your return, whichever is smaller.
I'm a little confused by the language "5% of the amount due."
Of what amount due? It could mean more than one thing. Does it mean 5% of:
1. the balance still remaining at any time after the 7/15/2020 payment due date?
2. the balance still remaining at the time the return is finally filed?
3. the original full amount of tax due on the return whether already paid or not?
4. some other amount?
I think at least the first three of these interpretations could be justified just reading the instructions. Number 3 is just scary, and it could be interpreted to mean that ("the amount due"). It doesn't say the balance due, it says the amount due. So it seems unclear as to which interpretation is right.
Can you clarify the amount on which the late filing (not late payment) penalty is imposed based on the the possible interpretations I enumerated above? Which of these is correct?
With that question in mind, assume that I pay at least the full balance due for my 2019 1040 by 7/15/2020 so that no additional balance is due after that date. Does that mean that no matter when the return is filed, that there will never be a late filing penalty? If so what is to stop someone from filing even after the extension expires (not that I intend to do that since I don't have any reason not to file before the extension ends).
Thank you for helping me understand this. There are some big numbers involved on this return and I don't want any nasty penalty surprises due to a silly mistake on the 4868 even after I pay everything on time. So I need to be completely sure that I am not going to incur any late filing penalties.
