Nov 19th 2013
By Ken Berry
In a media briefing held on November 8, high-ranking officials of the American Institute of CPAs (AICPA) urged the IRS to develop and publicize a contingency plan in the event the government shuts down again January 16. One of the main concerns voiced in the conference call, which was attended by AccountingWEB, was that another closing would further delay the 2014 tax filing season for 2013 returns.
Now the AICPA has gone one step further: It put the request in writing in a formal letter to the IRS. The letter, sent on November 18, calls for the IRS to take prompt action.
Previously, the IRS announced that the sixteen-day shutdown in October has forced it to push back tax filing season from its usual start date of January 21. The nation's tax collection agency projects it will need an extra week or two to update all the systems used to process almost 150 million federal income tax returns. Thus, the tax filing season might not kick off until sometime between January 28 and February 4.
Another potential shutdown date of January 15, 2014, looms unless Congress can agree on a budget. On February 7, 2014, the Treasury would have to take extraordinary action to manage US credit.
Mindful of the fallout from the October shutdown, the AICPA hopes to avoid any dire consequences. "Our members and their clients are concerned about any additional delay in the filing season as well as any planned reduction in IRS services that may affect a taxpayer's and a tax practitioner's ability to timely file tax returns, pay taxes, obtain refunds, address notices from the IRS, or contact the IRS with questions," the letter stated. "We hope that in the event of a January 2014 government shutdown, the government is able to retain many more IRS employees as deemed essential during filing season than occurred during the October shutdown," it continued. The AICPA offered to work with the IRS to identify the key issues and provide solutions.
AICPA Director, Tax Advocacy Melissa Labant expressed similar sentiments in an exclusive phone interview with AccountingWEB. She expects the IRS will react to the letter in the best interests of taxpayers and practitioners. In addition, Labant emphasized the need for contingency plans to be more comprehensive this go-round.
"I would hope that more resources would be available due to the timing and the proximity to tax filing season," said Labant. She referred to some of the problems encountered when the IRS had to cut back on operations in October. "At the time, they didn't issues refunds. I would hope they would issue refunds." Labant also stressed the importance of maintaining IRS hotlines that weren't available the last time.
Despite the potential for a long-term standoff in Congress, Labant doesn't foresee the IRS pushing back the April 15 filing due date. "It appears to be set in stone," she surmised. Nevertheless, desperate times could call for desperate measures.