At Advanced Tax Solutions we thought it was odd that the IRS would not allow tax returns to be submitted for processing until February 1 of 2014, for 2013 Income Tax Return year. The statements by the government indicated they needed additional time (about two weeks) to finalize the forms due to the 16 day government shutdown.
We felt this was kind of odd, as in the past the only forms that were delayed were the ones that had tax law changes. We speculated that with all the discussions of government budget problems etc. that perhaps they did not have enough money to pay for the flood of income tax refunds that happen at the first part of the tax season.
Is the IRS short on funds?
It’s no secret that the people who are first to file at the beginning of the tax year are generally people with large income tax refunds. Generally it’s the taxpayers who have a lower income and qualify for either or both the child tax credits or earned income credit. The rest of us who owe money are generally not rushing down the road to file our tax returns. If you are having cash flow problems at the government level, you’d probably want to slow that rush for refunds down; which supports our skepticism regarding the delayed filing season.
The Wall Street Journal recently published a piece on whether or not the government is having a “fresh battle” over the debt ceiling. Coincidently, this occurred 3 days after the two week delay announcement.
The article, “Tax Refunds Add Urgency on Debt Ceiling” dated February 4, 2014 goes on to outline the urgent need to raise the debt ceiling to be able to finance the government’s ability to meet its obligations related to funding the income tax refunds of taxpayers.
Perhaps it’s really a colossal coincidence, but it feels like the IRS is in having a hard time giving taxpayers their income tax refunds on a timely basis!
What this Means for You, the Taxpayer
With these culminating events we recommend filing on time with an accredited tax professional. If you haven’t filed in years and you fear dealing with the IRS on your own, contact Advanced Tax Solutions today for a free consultation.