Tax Tip Tuesday

 

The 2019 Government Shutdown

By Phylicia Buie, MST 1/8/2019 10:35 AM EST

As the partial government shutdown extends into it’s third week, the Internal Revenue Service has sent nearly 90 percent of its workforce home without pay (according to the contingency plan published by the agency in December.) The IRS has yet to update this plan and continues to direct news outlets to the lapsed plan from December. The remaining employees still working are focusing on implementing the 2018 Republican tax plan or serving on activities related to the “safeguard of human life.”

With new tax law changes and a severely understaffed IRS workforce, the opening of the 2019 filing season is huge question mark for the IRS and practioners. In this newsletter, we’ll highlight how this will affect your taxes and things you can do to get ready.

NO DELAY FOR OPEN FILING SEASON

The IRS tax filing season is set to begin. Despite the government shutdown, the Internal Revenue Service confirmed Monday evening that they will process tax returns beginning January 28, 2018.

What should you do: Don’t wait… get your tax documents ready! There’s no need to wait. You may file when you’re ready to submit a complete and accurate tax return.

WHAT WILL AND WON’T THE IRS BE DOING

According to the IRS contingency plan, the retained employees will only deal with activities that are considered to be essential (or “excepted” per IRS language). Those non-essential activities the IRS will put on the back burner include: performing audits or any type of enforcements, responding to notices and offering telephone assistance to taxpayers.

So, what does the IRS consider to be an essential service? Accepting your tax payments! If you visit IRS Direct Pay, you will find an alert stating the IRS is still accepting payments and taxpayers should continue to submit payments in accordance with their normal schedule.

Additionally, the IRS announced Monday evening they will issue refunds during the shutdown. To accomplish this, the IRS will be recalling a significant portion of its workforce, currently furloughed.

What should you do: Again… don’t wait! If you’ve received an IRS notice in the mail make sure you get that to your tax professional and start the resolution process right away. If you owe taxes or expect to owe make sure your submitting your payments on time. Your best defense with the IRS may be the time stamp of responding to notices or submission of payments.

If you are an early filer who depends on that early refund to compensate for all that holiday spending, plan ahead for the current back log. Make sure you get your documents to your tax professional as soon as you receive them to ensure the earliest filing available to you.

GETTING TAX HELP

The IRS has been a great resource to taxpayers who don’t typically engage a tax professional to get their questions answered but with the shutdown, the IRS is not staffing for telephone assistance anytime soon. If you have questions about the government shutdown, the new tax law changes or specific questions related to your taxes give us a call or book an appointment for your tax consultation today.

 

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