With the October tax filing deadline fast approaching, the American Institute of CPAs (AICPA) submitted a letter to Acting Commissioner of the Internal Revenue Service (IRS), Scott Bessent, acknowledging the steps the IRS is taking to alleviate the impact of the government shutdown.
The AICPA previously recommended including retaining approximately 54 percent of its employees – an increase of staff compared to previous shutdowns – and prioritizing the need for guidance related to the implementation of PL 119-21/HR 1. However, the AICPA is disappointed that the IRS did not except all of its employees, as previously recommended.
The AICPA is recommending relief measures that are fair, reasonable and practical to mitigate the negative impact of the shutdown on taxpayers and practitioners. These recommendations include:
- Discontinue compliance actions and halt automated collection activities of liens and levies until at least 60 days following the end of the shutdown.
- Maintain all online systems and accounts.
- Offer an easily administrable reasonable cause penalty waiver resembling the first-time abatement (FTA) administrative waiver for taxpayers impacted by the government shutdown.
- Provide targeted estimated tax and late payment penalty relief.
“While it is helpful to know the IRS is retaining a greater number of staff than in previous shutdowns, we remain deeply concerned that the IRS will not have the ability to meet taxpayers’ needs during this filing season,” said Melanie Lauridsen, Vice President of Tax Policy & Advocacy with the AICPA. “This shutdown will create a greater backlog for the IRS and increase hardships for taxpayers and challenges for practitioners – however, if IRS staff is not fully excepted, our recommendations will help mitigate those negative impacts. We urge the IRS to consider our recommendations and avoid compounding an already stressful situation.”
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