It is not hard to deduce that the effects of the partial US government shutdown, on the Internal Revenue Service (IRS) are acute. Predictions vary as to how long it will take for the agency to rehabilitate; this is expected to be at least a year.

The American Institute of Certified Public Accountants (AICPA) penned a letter to the IRS just prior to Friday’s announcement of the end of the shutdown, citing the AICPA’s concerns around the ensuing effects of the IRS shutdown on taxpayers and practitioners.

Those concerns include:

  • The continuation of automated notices being sent to taxpayers during the shutdown period.
  • The automatic transfer of cases to collections without any opportunity for taxpayers to attempt to resolve the issue.
  • Although audit, examination and appeals activity have been suspended, practitioners are unable to respond to IRS collections activities.
  • The response timeframe for 90-day letters expiring.
  • Form 2848 Power of Attorney and Declaration of Representative not being processed.
  • Taxpayers’ and tax practitioners’ difficulties using IRS e-services online accounts.
  • Tax forms that are in draft format, related to changes under the Tax Cuts and Jobs Act (TCJA), and ensuing delays in tax return preparation software finalization for the current tax season.

The AICPA has recommended that the IRS consider implementing the following measures:

  • A 90-day automatic extension of time from the date the shutdown ends, for taxpayers and their representatives to reply to notices and collections.
  • Cessation of automated notices including penalty assessments and interest.
  • Changes to get online systems and accounts operating effectively.
  • Additional attorneys to be on hand for TCJA advisory.