Churches: The IRS is Substantially Closed, But Your Obligations Remain

Editor's Note (10/17/2013): Congress passed a bill last night that ended the shutdown. President Obama signed the bill ahead of the default deadline that loomed at 11:59 p.m.

Due to the lapse in federal government appropriations (the so-called "government shutdown"), substantial portions of the Internal Revenue Service are closed for business. This closure does not, however, impact any due dates or obligations required under the law. The closure does, however, severely impact the ability to contact the IRS and resolve issues.

The IRS has announced, "While the government is closed, people with appointments related to examinations (audits), collection, appeals or Taxpayer Advocate cases should assume their meetings are cancelled. IRS personnel will reschedule those meetings at a later date."

In the event that an organization has a scheduled meeting or examination pending, it's highly recommended that the organization, under the advice of its tax counsel, attempt to contact the appropriate IRS officials about the meeting or examination and diligently document all such attempts.

Following is an excerpt of a statement published by the IRS related to the government shutdown:

IRS Operations during the Lapse in Appropriations
Due to the current lapse in appropriations, IRS operations are limited. However, the underlying tax law remains in effect, and all taxpayers should continue to meet their tax obligations as normal.
Individuals and businesses should keep filing their tax returns and making deposits with the IRS, as they are required to do so by law. The IRS will accept and process all tax returns with payments, but will be unable to issue refunds during this time. Taxpayers are urged to file electronically, because most of these returns will be processed automatically.
No live telephone customer service assistance will be available, however most automated toll-free telephone applications will remain operational. IRS walk-in taxpayer assistance centers will be closed.
While the government is closed, people with appointments related to examinations (audits), collection, Appeals or Taxpayer Advocate cases should assume their meetings are cancelled. IRS personnel will reschedule those meetings at a later date.
Automated IRS notices will continue to be mailed. The IRS will not be working any paper correspondence during this period. Here are some basic steps for taxpayers to follow during this period.

The Effects on Churches and Church Leaders

  • You should continue to file and pay taxes as normal. Individuals who requested an extension of time to file should file their returns by Oct. 15, 2013.
  • All other tax deadlines remain in effect, including those covering individuals, corporations, partnerships and employers. The regular payroll tax deadlines remain in effect as well.
  • You can file your tax return electronically or on paper–although the processing of paper returns will be delayed until full government operations resume. Payments accompanying paper tax returns will still be accepted as the IRS receives them.
  • Tax refunds will not be issued until normal government operations resume.
  • Tax software companies, tax practitioners and Free File will remain available to assist with taxes.

What IRS services are Available?

  • For taxpayers seeking assistance, only the automated applications on the regular 800-829-1040 telephone line will remain open.
  • The IRS website, http://IRS.gov, will remain available, although some interactive features may not be available.
  • The IRS Free File partners will continue to accept and file tax returns.
  • Tax software companies will continue to accept and file tax returns.

This guest post first appeared in The Nonprofit Watchman, a free e-newsletter published by Batts Morrison Wales & Lee, P.A., that covers significant state and federal developments for nonprofits and their executives. Reprinted with permission.

The 2013 Church & Clergy Tax Guide, available at ChurchLawAndTaxStore.com, covers key tax law developments for 2013.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is published with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations."

Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

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