COLUMBIA, SC — The government shutdown has shuttered offices at myriad agencies, including the Internal Revenue Service, where doors are locked, helplines go unanswered and refunds won’t be issued.
For taxpayers who requested extensions on their 2012 individual tax returns, Oct. 15 is the deadline to file those returns – and that requirement is unaffected by the shutdown, according to information on the IRS website and on phone recordings at IRS offices.
“Clients that have waited until the Oct. 15 deadline to file to get their refund may see a significant delay in getting that refund because of the shutdown,” said Joe Montgomery of Greenville, CPA and owner of Montgomery & Co. CPAs.
“That obviously can cause problems if the client has been counting on that money for cash-flow purposes.”
An average of 7 percent of taxpayers file for the standard six-month extension every year, according to information from the IRS.
The extension gives taxpayers more time to complete and file their returns, but April 15 remains the deadline to pay any taxes due.
Those who haven’t paid or who owe additional taxes face both failure-to-file and failure-to-pay penalties if they miss the Oct. 15 deadline, Montgomery said.
But taxpayers who need assistance with those last-minute forms and calculations shouldn’t come knocking at the IRS for help.
Phone numbers for both the local IRS office on Roper Mountain Road and the toll-free taxpayer helpline are answered by recordings indicating all IRS offices are closed and referring taxpayers to automated phone systems or www.irs.gov for information.
“We’re not able to get answers right now,” said Paul Batson, owner of Batson Accounting and Tax.
Taxpayers who typically file their own returns may be able to research answers online – though it’s always a “buyer beware” situation when getting information from anywhere other than official sources, Batson said – or seek assistance from CPAs or other tax professionals, but that could mean incurring an extra expense.
Taxpayers with outstanding tax debts or ongoing audits from the IRS may be in a particularly confusing situation.
“I’m a little bit concerned for those clients because the penalties and interest are continuing to accrue,” Montgomery said.
“Shy of the IRS or Congress or somebody saying we’re going to suspend the penalties and interest for this period, you can only assume that the penalties and interest are going to continue. That’s going to be detrimental to some of our clients.”
Renita Owens, a Greenville CPA, said those who have received notices of IRS collection action may be in an even stickier situation.
“You don’t know if something’s going to happen while you still can’t talk to them. Will something be automatically drafted from your bank to make a payment? You can’t even call the government about it,” she said. “It leaves a lot of open-ended questions.”
Electronically submitted tax returns will be processed automatically, said the IRS website, and paper returns will be processed at a later date. The postmark on the return will serve as the submitted date.