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Tax Refunds To Be PAID During Government Shutdown

· tax,Tax Preparation,income tax,tax return
Wycotax - Tax Preparation Services

WASHINGTON D.C.—The Internal Revenue Service will issue out tax refunds even though the agency is subject to the federal government shutdown, according to The White House Office of Management and Budget, who announced on M​​onday morning.

Since the shutdown began Dec. 22, the tax agency and the Treasury Department have been preparing a plan for the filing season and had already been planning to call back workers needed to collect revenue. The administration is trying to make the shutdown as “painless as possible consistent with the law,” Russell Vought, the acting OMB director, told reporters.

The biggest concern from tax payers was the fate of refunds. Without tax refunds being issued, the Federal Government could face steep political consequences, especially because the 2019 tax filing season is the first under the tax law (Tax Cuts and Jobs Act) that President Trump and Republicans enacted at the end of December 2017.

There are a limited number of activities the federal government is allowed to perform during a shutdown. Traditionally, the Internal Revenue Service (IRS) has not issued refunds to taxpayers while the government is shut down. The Treasury Department has interpreted one exception—to protect life and government property—to enable the IRS to collect tax revenue but not pay refunds.

Last year, the IRS processed 136,359,149 tax returns during the regular tax season; just over 10% of taxpayers tend to file an extension, bringing the total number of tax returns processed during the year to 154,058,000. Of those returns, over 70% resulted in tax refunds, worth $324 billion to 111,911,000 taxpayers, with the average tax refund check ringing in at $2,899.

For more information, please visit these websites: forbes.com, wsj.com.

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