Due to the ongoing government shutdown, the IRS is largely closed for business. Taxpayers with ongoing audits or matters before IRS Appeals should expect that no action will be taken during the shutdown, except for actions to preserve the statute of limitations. The Tax Court is likewise closed until further notice, although eFiling and eAccess remain available. Taxpayers may also make paper filings with the court. Other federal courts remain open through 11 January 2019.
Items to Note
- The Department of the Treasury, the Department of Justice, and the U.S. Tax Court’s funding subject to annual appropriations lapsed as of 12:00 am EST on December 22, 2018.
- As a result, Treasury implemented its Lapse in Appropriations Contingency Plan. Agency-specific contingency plans, including for the IRS, were also implemented. The IRS contingency plan is attached and describes the actions and activities for the first five business days following a lapse in appropriations. For a shutdown lasting longer than five business days such as the current shutdown, the IRS will re-assess ongoing activities and identify necessary adjustments of excepted positions and personnel.
- Subject to certain excepted activities, most IRS personnel are currently furloughed. Non-excepted activities include “all audit functions, examinations of returns, and processing of non-electronic tax returns that do not include remittances.” This means audits are on hold. Excepted activities include “protection of statute expiration,” which means that taxpayers under audit may receive Forms 872 statute extension requests or notices of deficiency during the shutdown.
- Tax Court.
- As of December 28, 2018 at 11:59 pm, the United States Tax Court is closed until further notice. Notwithstanding the closure, trial sessions scheduled for the weeks of January 7 and 14, 2019 will proceed as scheduled.
- eFiling and eAccess will be available. Taxpayers may comply with statutory deadlines for filing petitions or notices of appeal by timely mailing a petition or notice of appeal to the court. Timeliness of mailing of the petition or notice of appeal is determined by the United States Postal Service’s postmark or the delivery certificate of a designated private delivery service.
- Other federal courts.
- Other federal courts remain open and continue operations for approximately three weeks, through January 11, 2019 by using funds not dependent on a new appropriation. The Case Management/Electronic Case Files systems also remains in operation for electronic filing of documents.
- Most proceedings and deadlines will occur as scheduled. In cases where an attorney from an Executive Branch agency is not working because of the shutdown, hearing and filing dates may be rescheduled.
- If the shutdown were to continue past January 11, 2019, each court would determine the staffing resources necessary to support the exercise of its Article III judicial powers.
Q. What if I have a meeting scheduled with the IRS relating to my ongoing audit?
A. Taxpayers should expect that no previously-scheduled meetings with the IRS will proceed during the shutdown.
Q. What if I have an IDR response due during the shutdown?
A. While there is no extension granted to taxpayers with IDRs due during the shutdown, taxpayers may choose to hold off submitting any IDR responses to the IRS until the shutdown ends to ensure that the response is properly received. Taxpayers should discuss with their advisors whether to submit a response subsequent to a previously agreed due date as a result of the shutdown.
Q. Does the shutdown mean that the IRS will ask me to extend the statute of limitations?
A. If the shutdown drags on, taxpayers should anticipate that Exam teams will seek extensions of the statute of limitations to permit additional time to perform audit activities as a result of the shutdown. Taxpayers should discuss with their advisors how to respond to any request for an extension of the statute of limitations.
Q. What if my statute is now within six months of expiring?
A. The government has excepted IRS personnel from the shutdown to monitor expiring statutes. Taxpayers should expect to receive requests for extensions during the shutdown if the statute of limitations will expire within six months.
Q. What if my statute of limitations to file a claim for refund will soon expire?
A. Taxpayers should timely file all claims for refund notwithstanding the shutdown. If the statute of limitations to file a claim for refund expires during the shutdown, taxpayers will not be afforded additional time to file a claim.
Q. I received a statutory notice of deficiency and am supposed to file my petition for redetermination with the Tax Court, but the Tax Court is closed. Should I hold off filing until the Tax Court re-opens?
A. No. Timely filing a petition is a statutory requirement, so taxpayers should continue to meet all statutory deadlines. Timeliness of the filing will be determined by the United States Postal Service’s postmark or the delivery certificate of a designated private delivery service.