IRS and Congress should consider extending tax-filing season: paper

IRS and Congress should consider extending tax-filing season: paper

Congress and the IRS should consider extending this year's tax-filing deadline after the government shutdown caused challenges for the agency, a right-leaning group said in a report Thursday.

"With less than six weeks remaining in the ordinary filing season, this is an urgent matter to address," the National Taxpayers Union Foundation (NTUF) said in its report. "Moving to enact an extension now can save a lot of headaches for taxpayers and tax practitioners."

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The 35-day government shutdown, during which most IRS employees were either furloughed or working without pay, ended only days before the tax-filing season began in late January.

The shutdown resulted in a backlog of correspondence and a drop in the IRS's level of service on its phone lines, according to a report issued last month by National Taxpayer Advocate Nina Olson.

NTUF's report particularly highlighted that most people calling to talk about a balance due were unable to reach a live person one week after the shutdown ended.

"Additional data will be released as filing season progresses, but the early returns suggest an agency that is unprepared to discharge its duties to assist taxpayers in understanding their legal obligations," NTUF wrote.

NTUF also noted that the number of tax returns processed through Feb. 22 was down 4.6 percent compared with the same period last year, and the group argued that the shutdown caused challenges for private-sector tax preparers.

"The shutdown meant that the IRS wasn’t providing assistance to many private tax preparers, leaving those with particular client matters in a difficult spot," the group wrote.

NTUF said that Congress and the IRS should look at extending tax deadlines by at least one month, since the shutdown was 35 days long. 

"That would push the individual filing deadline to May 15th, 2019, giving taxpayers some additional breathing room and giving the IRS extra time to complete an orderly processing of returns while providing necessary support to those in need," the group wrote.

The report comes as tax preparers say that they've faced a number of challenges this year and are seeing their clients report increased anxiety.

NTUF said the best way to extend the deadline would be for Congress to pass legislation, but that the Treasury Secretary likely has the authority to do it.

"The newly-passed [Tax Cuts and Jobs Act] was already poised to shake up tax filing, but the shutdown constituted an earthquake for an agency with an unstable foundation to begin with," NTUF wrote. "By taking swift and decisive action, Congress and the IRS can help to ease the time crunch that threatens to harm taxpayers and further disrupt IRS operations."