By Jason Bramwell
The 2014 tax-filing season, which was scheduled to begin on January 21, 2014, will be delayed approximately one to two weeks as a result of the recently concluded federal government shutdown, the IRS announced October 22.
The extra time will allow the agency to program and test tax-processing systems – something that could not be done while thousands of IRS employees were furloughed during the government stoppage, which lasted from October 1 to 16.
The IRS is looking at options to possibly shorten the delay, and the agency is expected to announce a final decision on the start of the 2014 filing season in December, acting IRS Commissioner Daniel Werfel stated on Tuesday. With a one- to two-week delay, the IRS would start accepting and processing 2013 individual tax returns no earlier than January 28 and no later than February 4.
However, the IRS reiterated that the April 15 tax deadline is set by federal statute and will remain in place. Taxpayers can request an automatic six-month extension to file their tax return using Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return, which can be filed electronically or on paper.
The federal government shutdown occurred during the peak time the IRS uses to prepare its systems for the upcoming filing season. More than fifty IRS systems have to be programmed, tested, and deployed so they can handle the processing of nearly 150 million tax returns. There are additional training, programming, and testing demands on IRS systems this year in order to provide additional refund fraud and identity theft detection and prevention. IRS processes, applications, and databases must also be updated annually to reflect changes to tax laws, business processes, and programming in time for the start of the filing season.
Even though updating its core systems is a year-round process, the IRS reported it conducts the majority of the work beginning in the fall of each year.
That system preparation was delayed during the shutdown, which temporarily closed approximately 90 percent of the agency's operations and has now set the IRS back nearly three weeks in its timetable for being ready to start the 2014 filing season.
"Readying our systems to handle the tax season is an intricate, detailed process, and we must take the time to get it right", Werfel said in a written statement. "The adjustment to the start of the filing season provides us the necessary time to program, test, and validate our systems so that we can provide a smooth filing and refund process for the nation's taxpayers. We want the public and tax professionals to know about the delay well in advance so they can prepare for a later start of the filing season."
The shutdown also caused the IRS to delay Preparer Tax Identification Number (PTIN) renewals for 2014.
Paper tax returns will not be processed before the 2014 filing season start date is officially announced, according to the IRS, which recommended taxpayers use e-file with direct deposit to receive their tax refunds more quickly.
The IRS continues resuming and assessing operations following the government closure. The agency reported heavy demand on its toll-free telephone lines, walk-in taxpayer assistance centers, and other services from taxpayers and tax practitioners. During the shutdown, the IRS received 400,000 pieces of correspondence – on top of the 1 million items already being processed before the agency had to temporarily close its doors.
"In the days ahead, we will continue assessing the impact of the shutdown on IRS operations, and we will do everything we can to work through the backlog and pent-up demand", Werfel said. "We greatly appreciate the patience of taxpayers and the tax professional community during this period."
The IRS encouraged taxpayers to wait to call or visit if their issue is not urgent, and to continue to use automated applications on the IRS website whenever possible.