Hi,
Filing a New Jersey extension does not protect you from penalties unless you also paid at least 80% of your tax by April 15.
This is the rule most people, and even some preparers, get wrong. A New Jersey extension is an extension of time to file, never an extension of time to pay. It only holds if all of these were true by April 15:
- You paid at least 80% of your total NJ tax liability for the year
- You paid it through withholding, estimates, or a payment with the extension
- You filed the extension request (NJ-630 or a federal extension) on time
Miss the 80% and here is what the state assesses, all dated back to April 15:
- Late filing penalty: 5% of the unpaid balance for every month late, up to 25%
- An additional $100 for every month the return is late
- Late payment penalty: a flat 5% of the balance due
- Interest at 3 points above the prime rate, compounded, until it is paid
If you have not filed your 2025 return yet, do it now. Reply so we can start immediately. Every month it sits unfiled adds another 5% and another $100, so filing is the single fastest way to cap the damage – even if you cannot pay the full balance today.
If you already received a penalty notice, forward it to us. Depending on your situation we can request an abatement for reasonable cause, confirm the state calculated it correctly, and set up a payment plan if you need one.
Reply to this email by Monday next week and we will schedule a 15 minute call with our senior tax advisor to review where you stand on your extension and build an action plan before the next month of penalties hits. If you have a notice, attach it and we will take it from there.
Sincerely,
—
George Dimov, CPA
Licensed and Insured
(833) 829-1120 toll free
(212) 994-8081 Fax
www.dimovtax.com