Delinquent taxpayers who may be cheering on the partial federal shutdown that includes the Treasury Department and Internal Revenue Service should think again.
Because an IRS contingency plan drawn up in anticipation of a shutdown considers tax collecting essential to “activities necessary to safeguard human life or protect government property.”
As a result, 9,946 IRS auditors, criminal investigators and top executives are still on the job. That accounts for 12 percent of the 79,868 agency workers, according to the 110-page Lapsed Appropriations Contingency Plan.
Among the key group of federal workers not “furloughed” by the ongoing shutdown due to the battle between President Trump and Democrats over $5 billion for construction of a border wall on the U.S.-Mexico border are tax collectors.
In other words, the processing of tax returns where an additional payment will be required is considered essential.
Considered non-essential are those that issue tax return payments to taxpayers. Or answering taxpayer questions.
The plan outlines a five-day shutdown. If it goes further, changes may be made.
The accounting community has seized on the 110-page plan and spread it to accountants and clients. The big firms are also writing up reviews of the plan and its impact, and some are sending around analysis done by Forbes and the Journal of Accountancy.
The Forbes story puts the contingency plan in simple English.
Said Forbes: “The law also allows for ‘activities necessary to safeguard human life or protect government property.’ You might not think of your tax return as a matter of life or death but the government begs to differ: The IRS may process tax returns to ensure the protection of those returns that contain remittances (in other words, they can make sure that the government gets its money).”
Functions suspended in a shutdown, said the Journal:
- Issuing refunds.
- Processing Form 1040X amended returns.
- All audit functions and examinations of returns.
- Processing paper tax returns that do include remittances.
- Taxpayer services, such as answering taxpayer questions.
But still operating, added Forbes:
- Processing of returns with payments.
- Processing disaster relief transcripts.
- E-filing up to the point of refunds.
- Design and printing of tax forms.
- Appeals (statutory deadlines will not be changed).
- Certain civil and criminal tax cases (statute expiration, bankruptcy, liens and seizures cases).
- Active criminal investigations.
