Ask the Expert: Tax Concerns Regarding the Government Shutdown

Hooray, 2019 is here! It’s an exciting time of year, tax-wise, as we anticipate the arrival of W2s and potential tax refunds! This year, however, we are in a unique situation with one of the longest government shutdowns of the past twenty years happening now.

Now, how does this affect payroll taxes? With the shutdown, many government agencies, including the IRS, are either closed or working in a limited capacity. Currently, only about 12% of the IRS workforce is active and many of their operations have been put on hold, including taxpayer assistance. Try to call the IRS right now, and you’ll be led to an automated message notifying the caller of the temporary closure.

We want to make it clear that the shutdown is not currently impacting any submissions of payroll tax payments and that we are staying on course for payroll tax payments and returns. These are still being remitted per the normal schedules along with 4^thquarter filings.

If the shutdown persists into the coming weeks, however, the return filing season could be affected. As of now, the IRS is not processing any refunds and probably won’t resume doing so until the shutdown ends. Most experts agree that if the shutdown ends before mid-January, there should be no impact on tax season. However, if there’s a longer governmental hiatus in store, we can anticipate delays and an updated IRS operational plan.

Putting all differences aside, we hope the shutdown ends soon. For the meantime, we recommend checking the IRS website and the news for further information as we approach the height of the tax season.