IRS Affected by Government Shutdown

Originally published in the Cedar Street Times

October 4, 2013

Due to the inability of Congress to come to terms regarding the government shutdown (or just about anything for that matter), I have a pretty good chance that this article will still be worth reading by the time it is published in the newspaper on Friday!

Everyone is aware by now that over 800,000 federal employees are on furlough. I read that this is more than all the employees of Target, General Motors, Exxon, and Google combined.  That is a lot of people!  Included in these 800,000 are most of the Internal Revenue Service employees.

Many of you may be cheering right now, but certainly not anyone that is waiting on a refund or currently trying to work out any problems with the IRS.  Prior to the furlough, telephone wait times to speak with an IRS agent have been 15 – 45 minutes, or sometimes you would get the message that they were too busy to even put you on hold, and then hang up on you.  Right now you will have an indefinite wait since the call centers are completely closed.  All local IRS offices are also closed to the public as well.  The shutdown will of course put even more pressure on wait times when funding is restored, and there is a backlog of problems to resolve.

This is an interesting time to be shutdown considering that extended personal tax returns are due on October 15.  The IRS still expects individuals and businesses to file all tax returns on time, keep making income and payroll tax payments, etc.  Presumably, they have some essential employees still on-the-clock to let the mailman in and to make deposits!  They are encouraging electronic filing since those returns are processed automatically by computers.  Paper returns will not be processed, however any payments enclosed will still be processed!  All tax refunds are suspended until normal operations resume.

Computer generated IRS notices will continue to be mailed out, but all audits, appeals, and taxpayer advocate cases are suspended.  If you had meetings scheduled they will be rescheduled.

The IRS website will still be up and running, but certain services may be unavailable.  The IRS automated telephone system will also still be working (800) 829-1040.

I can only assume that penalties and interest will still accrue even if you are waiting on the IRS to resolve an issue.

I called the IRS employee emergency hotline for kicks.  They are informing employees that they cannot perform any work, even if they want to volunteer their time to keep certain cases moving, and they cannot use any government computers, equipment, or other resources.  If they were en route traveling when the furlough began, they were to immediately return home.

Prior articles are republished on my website at www.tlongcpa.com/blog.

IRS Circular 230 Notice: To the extent this article concerns tax matters, it is not intended to be used and cannot be used by a taxpayer for the purpose of avoiding penalties that may be imposed by law.

Travis H. Long, CPA is located at 706-B Forest Avenue, PG, 93950 and focuses on trust, estate, individual, and business taxation. He can be reached at 831-333-1041.

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