Tax Refunds Delayed By Government Shutdown

By Michael Felz, CPA MST, Partner
Your wait for your tax refund may be a little longer than normal.
The government’s Office of Management and Budget reported on November 7, 2013, that the October government shutdown caused roughly $3.7 billion in tax refunds to be delayed. The delay includes $2.2 billion due to individuals. The shutdown coincided with the October 15th extended filing deadline for individuals, so it is likely that returns filed during that timeframe were most affected.
Under the Prompt Payment Act and the Cash Management Improvement Act, the federal government is required to pay interest on payments due to third parties when it fails to pay these bills on time. The gov¬ernment will owe interest on some of the delayed IRS refunds.
The report states that the shutdown also halted most IRS enforcement activities, and that taxpayer correspondence went unaddressed. This may lead to additional problems for taxpayers, especially in situations where due dates occurred during the shutdown. Please contact us for assistance if you are impacted by these delays.
The IRS also could not engage in normal com¬puter programming and testing in preparation for the 2014 tax filing season. As a result, some taxpayers who file early and are entitled to refunds may have their re¬funds delayed for up to two weeks due to the delay of the start of the originally planned 2014 tax filing season.