Just when it looked like the fallout from the 16-day government shutdown was over came news Wednesday that millions of tax refunds will be delayed next year.
The Internal Revenue Service said it will not start processing returns until at least Jan. 28 and possibly as late as Feb. 4, instead of the planned start date of Jan. 21. Should the government shut down again in January over budget talks scheduled as part of the deal to reopen the federal government, refunds could be tied up even longer.
The shutdown meant that about 90 percent of IRS employees were out of work for the 16 days. That puts the agency about three weeks behind as it goes into the upcoming tax refund season, according to acting IRS Commissioner Danny Werfel.
Because tax laws and regulations change from year to year, the IRS has to make adjustments well in advance of tax return season. Melisa Labant, director of tax advocacy for the American Institute of Certified Public Accounts, told USA Today: “There are a lot of tax changes, particularly due to the 3.8 percent net investment income tax from the Affordable Care Act. The IRS has a lot of guidance they have to issue, including the matter of gay couples filing their federal returns as married couples.
"What concerns me is not the initial delay, but if there is any additional hiccup between now and January, the delays could be longer," Labant said.
USA Today also reported that this is not he first time government gridlock has delayed the start of filing season. The 2013 tax filing season was delayed because Congress didn't pass laws pertaining to 2012 returns. And the IRS hotlines were closed for the Oct. 15 filing deadline for filers who requested extensions because of the most recent shutdown.
There was a lot of damage done during the 16-day shutdown. If Congress is foolish enough to repeat the calamity in January, there should be hell to pay come next Election Day.