Hi from Just Answer. Saw something that might add to what the first Expert provided.

While there does not appear to be a grace period, there is statutory authority for requesting, and the state granting, abatements for penalties and interest for reasonable cause. In the NJ Administrative Code, Title 18, Chapter 2, Subchapter 2, Penalties and interest, 18:2-2.7 Abatement of Penalties and Interest spells out how a taxpayer can show reasonable cause and how the Director can accept the request and abate these charges if there is a successful argument.

http://www.state.nj.us/treasury/taxation/pdf/regs/penalties.pdf is the link to the text. While I did not citate the law section for your answer, it is a good starting point.

Thanks from Just Answer. If you need anything more, please ask for the Expert of your choice.

First problem is that the exte.sion itself was not accepted. That is what caused the big penalty. A late extension is the same as no extension. As stated earlier you. Can request an abatement but they are not under any requirement to accept your request.
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A followup:

Reasonable Cause is described int he below document. The only circumstance that sounds like you might qualify for:

5. Any other cause for delinquency which would appear to a person of ordinary prudence and intelligence as a reasonable cause for delay and which clearly indicates an absence of willful neglect may be determined to be reasonable cause. Ignorance of the law, however, will not be considered as a basis for reasonable cause.

http://www.state.nj.us/treasury/taxation/pdf/regs/penalties.pdf

Hi again from Just Answer. Given your fact pattern, I think you certainly have an argument. There are several things that go into a reasonable cause abatement.

The first is your track record with the taxing authorities. If this is your first late payment penalty issue, I think you have a better chance. I would make sure to mention a good taxpayer history of making payments and filing timely in your abatement request.

Secondly, the payment was offered timely, but missed due to clerical error. The repair was done upon notice of the error. These are steps a reasonable person would have done upon notice.

Third, are the times we are in. Tax revenues are important to governments now, maybe more than ever. Internal pressures to generate revenues from interest and penalties, which are a profit center for tax agencies, can influence how abatements are handled.

I believe, assuming a profitable taxpayer with a good history and making a timely request, that your request could have a good chance of acceptance. I agree that the state has no burden to accept the request, but the fact that they accept such requests, and give guidelines for acceptance, leads me to be optimistic in your case.

Thanks again from Just Answer.