IRS reveals shutdown strategy: Employees required to work first 5 days

IRS to Continue Operations Despite Potential Government Shutdown

IRS Employees Brace for Potential Government Shutdown

In a move to maintain operations amidst a potential government shutdown, the IRS announced that all its employees would remain at work for the initial five business days. This decision is part of a lapsed appropriations contingency plan, which was disclosed on Monday. Salaries during this period will be supported by funds from the Inflation Reduction Act of 2022.

Funding Challenges and Staffing Plans

The IRS, comprising over 74,000 employees, is set to operate under this plan for fiscal year 2026. Despite the headcount, federal employees will not receive pay during the shutdown until it concludes. Originally, the Inflation Reduction Act allocated $79.4 billion over a decade. However, congressional adjustments have reduced this to $37.6 billion as of March, a report by the Treasury Inspector General for Tax Administration revealed.

Impact on IRS Operations and Upcoming Deadlines

The IRS plans to continue operations without a hitch come October 1, 2025, ensuring there is no lapse in appropriations, as stated in their contingency plan. As the government edges toward a shutdown scheduled for 12:01 a.m. Wednesday, employees remain hopeful for a resolution. The U.S. House of Representatives has passed a bill to extend funding for seven weeks, but it is currently stalled in the Senate, which requires significant bipartisan support to pass.

AICPA Calls for Full IRS Staffing

On Monday, prior to the IRS releasing its contingency plan, the AICPA requested that the agency keep all staff on board during any potential shutdown. The AICPA emphasized the importance of this measure due to the imminent deadlines facing taxpayers and tax practitioners, including:

• Extended 2024 tax returns due by October 15
• Tax-exempt organization returns due by November 17
• Expatriate tax returns due by December 15

Potential Delays in the Upcoming Filing Season

The AICPA further expressed concerns over possible delays in the upcoming tax filing season, typically commencing mid-January. The shutdown could also affect the release of guidance for H.R. 1, P.L. 119-21, known as the One Big Beautiful Bill Act.

Emegypt will continue to monitor the developments closely and provide updates on this evolving situation.