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The IRS partial shutdown is causing heartburn to some and spring break to others.  The most important thing to be aware of is how to deal with levy notices, return filing and tax refunds during this shutdown period.  Due to the lapse in appropriations, most IRS operations are closed.  An IRS-wide furlough began on December 22, 2018, for everyone except already-identified excepted employees. Non-excepted employees were furloughed and placed in a non-pay and non-duty status until further notice.

Despite the government shutdown, the IRS has since recalled a portion of its non-excepted workforce, currently furloughed as part of the government shutdown, to work.    Updates regarding IRS operations are as follows:

2019 Filing Season: Key Information for Taxpayers

The IRS has announced that the 2019 filing season will begin on January 28, 2019, for individual taxpayers. The IRS began accepting business tax returns (non-1040 series) on January. 8, 2019.

Taxpayers should keep several things in mind during this challenging period:

  • File electronically. The IRS will accept paper and electronic tax returns, but taxpayers are urged to file electronically to speed processing and refunds.
  • Tax refunds. Refunds will be paid, but the IRS cautions that returns will continue to be subject to refund fraud, identity theft and other internal reviews as in prior years. Taxpayers should use e-file or Free File with direct deposit to help speed refunds.
  • Tax filing. Taxpayers can go ahead and start working on their returns in advance of the Jan. 28 opening. Both tax software and tax professionals will be available and working in advance of IRS systems opening. Software companies and tax professionals will then submit the returns when the IRS systems open. The IRS strongly encourages people to file their tax returns electronically to minimize errors and for faster refunds.

Additional information related to the 2019 filing season will be available in coming days.

Limited Operations During the Appropriations Lapse

Automated applicationsIRS.gov and many automated applications remain available, including such things as Where’s My Refund, the IRS2go phone app and online payment agreements.

Telephones. No live telephone customer service assistance is currently available, although the IRS will be adding staff to answer some of the telephone lines in the coming days. Due to the heavier call volume, taxpayers should be prepared for longer wait times. Most automated toll-free telephone applications will remain operational. The IRS encourages people to use IRS.gov for information.

In-person service. IRS walk-in taxpayer assistance centers (TACs) are closed. That means those offices are unable to handle large cash payments or assist identity theft victims required to visit an IRS office to establish their identity. In-person assistance will not be available for taxpayers experiencing a hardship.

Taxpayer appointments. While the government is closed, people with appointments related to examinations (audits), collection, Appeals or Taxpayer Advocate cases should assume their meetings are cancelled. IRS personnel will reschedule those meetings at a later date, when the IRS reopens.

Taxpayer correspondence. While able to receive mail, the IRS will be responding to paper correspondence to only a very limited degree during this lapse period. Taxpayers who mail in correspondence to the IRS during this period should expect a lengthy delay for a response after the IRS reopens due to a growing correspondence backlog.

Tax-exempt groups. The IRS will not be processing applications or determinations for tax-exempt status or pension plans.

Enforcement activity. During this period, the IRS will not be conducting audits, but automated initial contact letters will continue to be mailed. No collection activity will generally occur except for automated collection activity. For example, automated IRS collection notices will continue to be mailed. Criminal Investigation work, however, continues during this period.

Passports & Mortgage Loans. Conflicting information has been reported as to whether the IRS will be certifying for the State Department any individuals for passport eligibility. The IRS began processing requests on January 7, 2019 for transcript information made through the Income Verification Express Service (IVES) program. IVES is a user fee-based program used primarily by mortgage lenders and others within the financial community to confirm the income of a borrower during the processing of a loan application.

For clients, tax professionals and others interested in a more detailed view of IRS operations during the shutdown or anytime, or with assistance regarding a pressing tax matter in which tax representation may be needed, the Orange County Tax attorneys at Wilson Tax Law Group, APLC or at 949-397-2292 are available to assist.