When are the taxes considered paid?

If I was Joe, I'd order 2012 and 2013 transcripts to determine if and when the $12,000 was carried forward.

I believe the amount would be considered paid on the original due date of the return. In other words, the 2012 overpayment used for the following year would be considered a timely Q1 estimated payment for

After all, the government had the money all along. It only makes sense to credit it to the earliest possible date that matters, namely the Q1 estimated payment due date, 4/15.

It can get more complicated when returns are filed out of statute (not your scenario), but for that I'd have to go searching.

Not a Code, Reg, or Rule cite, but the 20.2.4.3 (09-03-2010) Availability Dates for Overpayments

Prepayment credits (payments made before the due date of the return) are deemed paid as of the due date of the return (determined without regard to any extension of time to file) whether the return is timely or late filed.

Prepayment credits are available for refund or offset as of the return due date (determined without regard to any extension of time to file such return).

The April 15th date is only used for a timely filed return that was fully paid. In this instance the return was not timely filed. Therefore, the payment date to be used when you apply an overpayment on a late filed return is the postmark on the return.

The IRM reference in Paultry's other post suggests otherwise, if I read it correctly. Let's try an even more simple case: suppose an automatic extension (no payment) is filed for 2012, and then the return itself is filed on the extended due date. Now in that scenario, I really am pretty sure that the overpayment is treated as if made on 4/15, not later, when the return was actually filed.

I say this because I have learned the hard way that when a client has both an extension payment to make for the just-closed tax year, and a Q1 estimated payment for the current tax year, it is always better to put all the money into the extension payment, and then file the return, let's say by Jun 15, applying as much of the extension overpayment as needed to the Q1 estimated payment. This way, you don't have to nail down the current year estimates by 4/15 and make the client deal with two payments on 4/15, you can safely wait until Jun 15.

I probably should have read all of the original post. The only reason I could think of for anyone to ask this question was to determine whether the IRS would pay interest. Now I see the query was about a late payment penalty. So...

1. There can only be a late payment penalty if you owe tax. As no tax was owed.... no late payment penalty.
2. The over payment is credited as of the due date of the return 4/15.
3. Interest would only start to begin from the filing date (postmark on the return).