State extension for partnership plan

[Bird]

OK, I had a call from an accountant and my first response was "well, if a client asked me I would tell them to ask their accountant." That being said, here is the scenario/question:

A partnership sponsors a SH 401k. It is a pooled plan. Contributions made by 4/15 are greater than the employer contributions for employees. They need to go on extension to fund the remaining contributions. No problem for the federal return, but it would take "2 hours" to prepare the state extension(s) - multiple states I guess? Wants to know if it is ok to not extend the state returns.

I said that I thought the deduction would tie to the timing - if the deduction is taken on the K-1, then the K-1 might have to be extended, and if the deduction is taken on the 1040(s), then the 1040(s) would have to be extended. Of course deductions are taken on both. An argument could be made that the first contributions were for the employees, and were funded by 4/15 so the partnership return wouldn't have to be extended. But to be safe, it should be. I thought the 1040s would definitely need to be extended. (She said that she never thought of it that way and typically would NOT extend the 1040...but then I think she was actually talking about an S corp so that makes sense.)

Sorry for the long post - any thoughts?

[movedon]

I've never found a clear answer to this question, either. For the state or two where I've bothered to look at the state instructions (talking about personal returns here - never looked for a corp), there was no mention of the timing of the contributions and extending the state return, or any mention of the deduction at all really, since the states' method for determining income was to start with federal AGI and add things back, and retirement contributions weren't one of the add-backs. On the other hand, you are "deducting" the contribution for state purposes, so it stands to reason the state return should be extended. I always just advised doing it. It's a small thing (usually), and not worth the risk to me to tell someone not to do it.

[Peter Gulia]

Does the idea that some States measure income by following or adapting a Federal measure return your analysis to evaluating how the Federal tax returns and information returns affect whether a deduction or a non-recognition of income is valid?

[GMK]

Here's a list of how state's do extensions:

https://www.irs.com/articles/state-tax-extension-information

For some, it's automatic with the federal extension. Some require filing a form. Some don't tax income. ...

[Belgarath]

"Some don't tax income. ..."

I think I need to move. I'm pretty sure I get taxed on the air I breath, a user tax because my feet touch the ground when I walk, and because I'm either a member of a family or know people who are members of families.