The Professional Implications of Missing the April 15 Deadline

By Richard D. Isserman

April 15 has come and gone and New York state CPAs have spent the last several months in a frenzy, filing income tax returns for their clients, their family members and themselves. Some CPAs were not worried about the deadline because they filed extensions. Other CPAs were not concerned because they were certain they would meet the deadline. Despite their best intentions, this latter group simply ran out of time and now they’re kicking themselves, wishing they had filed an extension. Although small in number when compared to the population of CPAs in New York state, non-filing CPAs do exist. Some of the most trusted professionals cannot be trusted to file their own tax returns.

Reasons for failing to timely file vary. In some instances, returns have not been filed for a number of years and this year will be no different from prior years—the non-filing pattern will continue. Other CPAs will miss the deadline for the first time and will use one or more of the following excuses, including, but not limited to: lack of attention, stress, forgetfulness, inability to obtain needed information, divorce proceedings, poor health, sickness in the family, the old standby, “My dog ate the forms,” or any other creative reasons that sound vaguely plausible. But legitimate excuses, such as incapacity, are few and far between.

The New York State Society of CPAs’ and the American Institute of CPAs’ professional ethics committees recently issued an interpretation of their Codes of Professional Conduct that makes the non-timely filing of a tax return a violation of professional ethics that requires a mandatory suspension of the CPA’s membership. The action will be taken even if no tax is payable. The condition is the non-timely filing of the return.

One source of information available to the public regarding CPAs who have not filed their tax returns is an Internal Revenue Service (IRS) publication that names individuals who are suspended from practice before the IRS. The publication gives the name of the person and the period of the suspension. The IRS publication is monitored and those CPAs who are members of the NYSSCPA and AICPA can expect to be contacted by the respective ethics committee. Action taken will likely result in a suspension of membership from both organizations.

NYSSCPA and AICPA members are urged to file their income tax returns or extensions on time to avoid violating the ethics of the profession. A conviction of willful failure to file altogether results in an automatic expulsion from both organizations.