The present disclosure is directed to a tip extension assembly for a rotor blade of a wind turbine. The tip extension assembly includes a tip extension having a body with a pressure side surface and a suction side surface. Further, the tip extension is slidable onto a tip of the rotor blade so as to overlap the rotor blade adjacent the tip. In addition, the tip extension defines an extended trailing edge of the rotor blade. Moreover, an edge of the tip extension defines a step profile at a transition region between the tip extension and a trailing edge of the rotor blade. The tip extension assembly also includes at least one chord extension configured for attachment adjacent to the edge of the tip extension so as to minimize the step profile and associated noise caused thereby.