Effects of Government Shutdown on Taxpayers and Practitioners

Thefirst federal government shutdown since 1995-1996 involves the shutdown of manyfederal government functions that affect taxpayers and tax practitioners. 

Sowhat remains open?  Under the IRScontingency plan (which only covers the first five days), the IRS will continueprocessing tax returns that contain remittances and e-filed returns.  Employees in the Information TechnologyServices Enterprise Operations are excepted to ensure “refunds continue toprocess.”  The IRS will also take stepsto protect ongoing bankruptcy, lien, and seizure cases in order to prevent statuteof limitation lapses.  IRS criminal law enforcement and undercoveroperations also continue.  A skeletonstaff will maintain the IRS website and the Office of Chief Counsel will beexcepted.  Federal courts will remainopen for approximately 10 business days at which time the judiciary willreassess its situation. The U.S. Postal Service will continue to function andthe government will continue mailing Social Security checks.

Sowhat is closed?  All IRS taxpayerservices have been brought to a stop, such as responding to taxpayer inquiriesor processing paper returns not containing remittances. All IRS audits willstop as well as all nonautomated collection activities.  All IRS headquarters and administrativefunctions are shut down, and the IRS will not enter into any new contracts or issueany new purchase orders.  The Office ofProfessional Responsibility is closed, but the Return Preparer Office willremain open.  Approximately 86,000 IRSemployees has been furloughed. 

See Alistair M. Nevius,J.D., How the Government Shutdown AffectsTaxpayers and Tax Practitioners, Journal of Accountancy, Oct. 1, 2013. 

Special thanks toJim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringingthis article to my attention.