When the Federal Government shut down at midnight on December 22, 2019, the IRS started operating under a contingency plan with allows only excepted/exempt staff ( 9,942) to continue to work. Approximately 80,000 people are employed by the IRS, which means only 12.5% of the staff remains working.
Does this mean I don't need to file a return this year?
On Monday, January 7, 2019, the Internal Revenue Service (IRS) confirmed that e-filing of 2018 tax returns will start on January 28, 2019 and refunds will be issued. The due date will be unchanged as the IRS will be recalling a significant number of employees during the furlough.
You can paper file your return starting January 1, 2019. However by doing so, you won't get your refund any faster and you may be assessed a penalty if you use a computer to prepare it.
Business as usual
So what do you do now? It is business as usual. Taxpayers should file their returns as that would in any other year. Just know that :
* The preparation of your return could take longer due to the shutdown
* New information may need to be obtained to prepare your return this year given the new tax law changes (see another blog post on that)
* You may need to extend your return. Remember that extending your return is just an extension of time to file your return and not extending the time to pay your taxes. By extending your return, it does not increase your chances of getting audited. Taxpayers do it all the time and every year.
What isn't getting done
This means many of non-exempt functions are being suspended such as:
* Processing non-disaster relief transcripts, income verification express service/return and income verification services
* Processing 1040X amended returns
* All audit functions, examination of returns, and processing on non-electronic tax returns that do not include remittances
* Non-automated collections
* Information systems functions
* The closure of most headquarter and administrative functions not related to the safety of life and protection of property
By Barbara Dreves, CPA
If you have any questions or want to learn more, email barb@calc-you-later.com
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