What does it mean to file an extension?
Filing for extension on a tax return is a common practice used by accountants that gives you additional time to file and to get financial records and tax documents in order. You are still responsible for submitting any payments owed to the government by the tax filing due date, but your tax return can be submitted later.
If filing for extension, you must submit the extension by April 18, 2023, and the due date for your 2022 Form 1040 return will become October 16, 2023.
How do you file for extension?
Heard takes care of this for you! You can file for an extension using Form 4868 (the form and instructions to fill it out are viewable here).
Is it bad that I have to file my taxes on extension?
Not at all! Life happens, especially when you work in an incredibly demanding industry with a fluctuating client schedule. While we encourage you to fill out your Tax Questionnaire as soon as possible so we can get working on your tax return, an extension is put in place to protect yourself and help you avoid any fees or penalties, specifically the Failure to File Penalty, from the IRS or your state. Filing an extension is a perfectly acceptable practice utilized by many accountants (as well as many of people in general).
Contrary to popular misinformation: filing an extension will not increase your likelihood of an audit or create extension related penalties.
This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post.