Thursday, April 7, 2011

IRS Prepared to Process Returns If Government Shuts DownIRS Prepared to Process Returns If Government Shuts Down

IRS Commissioner Doug Shulman addressed the National Press Club on Wednesday, and after his prepared remarks he answered questions regarding the IRS’ preparations for a possible shutdown of the federal government, which could happen Friday.

The first question asked what people can expect if the government shuts down. Shulman said that “the president has made very clear that his goal is not to have a shutdown,” but he told the audience that the IRS has “been doing some contingency planning around this.” The AICPA had earlier been told that the IRS will release more information about its contingency plan on Thursday.

Shulman also emphasized that “people should file their taxes” and “the due date will remain April 18.” He said that processing of e-filed returns would continue as normal if the government shuts down, and he encouraged taxpayers, “whether there is a shutdown or not,” to file electronically.

He acknowledged, however, that processing of paper returns would be delayed if the government shuts down and that there would probably be a delay in refunds for taxpayers who file on paper.

When asked about other IRS functions—specifically, whether the Chief Counsel’s Office would continue work on pending regulation projects—Shulman said he was not ready to discuss “the nuances of who’s going to be doing what.”

The federal government is currently operating under a continuing resolution and not a formal budget for this fiscal year. The current continuing resolution expires at midnight on Friday, after which the federal government would shut down nonessential functions. Congressional and administration negotiators are reportedly working on a deal to avert a shutdown.

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