What does the government shutdown mean to the average taxpayer?

As most people know, the “non-essential” parts of the Federal government have been shut down due to lack of funding and budget compromise since December 22^nd.  With no immediate end in sight, what does this mean for your 2018 tax filings and potential refunds in 2019?

With the Tax Cuts and Jobs Act (TCJA), many more individuals and families were hoping for a larger tax refund this year.  Since about only 10% of the normal IRS staff is still active during the shutdown, that means refunds cannot be paid until the budget compromise is resolved. Thus, refunds could be delayed longer than usual.  Along with refunds, tax returns normally start to be accepted around the 3^rd or 4^th week of January.  With the TCJA, this was also expected to be slightly delayed due to the new 1040 form for all filers.  The shutdown could delay this process even further.  Also, the IRS cannot conduct audits during this time.  With all of this in mind, let’s hope for a speedy resolution!

Key list of functions that will impact taxpayers:

• No tax refunds issued
• No processing of non-disaster relief transcripts
• No processing of forms 1040X, amended returns
• No non-automated collections
• No audit or examinations (some exceptions apply)
• No legal counsel
• No call center during Non-Filing Season

Federal departments affected by shutdown

1. Agriculture
2. Commerce
3. Homeland Security
4. Housing and Urban Development
5. Interior
6. Justice
7. State
8. Transportation
9. Treasury

For federal employees OPM furlough guidance:

https://www.opm.gov/policy-data-oversight/pay-leave/furlough-guidance/

Federal government shutdowns since 1976:

Shutdown	Start	Duration	President	Senate	House	Key Reason
1	9/30/1976	11	Gerald Ford	Democrats (62-38)	Democrats (291-144)	HEW/Labor
2	9/30/1977	13	Jimmy Carter	Democrats (59-41)	Democrats (292-143)	Abortion
3	10/31/1977	9	Jimmy Carter	Democrats (59-41)	Democrats (292-143)	Abortion
4	11/30/1977	9	Jimmy Carter	Democrats (59-41)	Democrats (292-143)	Abortion
5	9/30/1978	18	Jimmy Carter	Democrats (59-41)	Democrats (292-143)	HEW / minor Abortion
6	9/30/1979	12	Jimmy Carter	Democrats (58-42)	Democrats (277-158)	Abortion
7	11/20/1981	3	Ronald Reagan	Republicans (53-47)	Democrats (244-191)	Domestic spending cuts
8	9/30/1982	2	Ronald Reagan	Republicans (53-47)	Democrats (244-191)	Social Engagements – Barbecue at the White House
9	12/17/1982	4	Ronald Reagan	Republicans (53-47)	Democrats (244-191)	Public works job program / MX & Pershing II missile program
10	11/10/1983	4	Ronald Reagan	Republicans (54-45)	Democrats (271-164)	Education, Aid for Israel/Egypt, less aid to Syria / El Salvador
11	9/30/1984	3	Ronald Reagan	Republicans (55-45)	Democrats (270-165)	Crime bill, Water project/ law reversing Title IX of the Civil Right Acts for colleges
12	10/3/1984	2	Ronald Reagan	Repbulicans (55-45)	Democrats (270-165)	Crime bill, civil rights bill, water projects, and Nicaragua Anti communist Contra Guerrillas
13	10/16/1986	2	Ronald Reagan	Republicans ( 53-47)	Democrats (253-182)	Welfare expansion / government’s privatization – Conrail
14	12/18/1987	2	Ronald Reagan	Democrats (54-46)	Democrats (258-177)	Nicaragua, Fairness Doctrine-FCC
15	10/5/1990	4	George H.W. Bush	Democrats (55-45)	Democrats (258-176)	Reduce the Deficit
16	11/14/1995	5	Bill Clinton	Republicans (53-47)	Republicans(233-199)	Meicare Premiums, Enviromnemntal regulations, balance the budget
17	12/16/1995	21	Bill Clinton	Republicans (53-47)	Republicans(235-198)	Use of economic forecasts to balance budget plan
18	10/1/2013	16	Barack Obama	Democrats (54-46)	Republicans (232-200)	Ted Cruz, Discretionary spending, Obamacare
19	1/20/2018	2	Donald Trump	Republicans ( 51-49)	Republicans(235-193)	Immigration
20	12/22/2018	13*	Donald Trump	Republicans (51-49)	Republicans(235-193)	Immigration / Trump Wall
				Republicans (53-47)	Democrats (235-200)	Immigration / Trump Wall