Will Government Shutdown Slow Tax Refunds?

tax refunds
Tax refunds could be delayed by the federal government shutdown.

The federal government’s partial shutdown could delay tax refunds.

According to CNBC, the IRS hasn’t said how long the shutdown would have to be before it affects the agency’s ability to process tax refunds. But, according to the network, the shutdown’s effect could be magnified by changes to the tax code passed in 2017:

In 2018, it nearly doubled the standard deduction to $12,000 for singles and $24,000 for married couples filing jointly. The law also curbed a slate of itemized deductions, and placed a $10,000 limit on the amount of state and local taxes filers can deduct.

In addition, taxpayers are also dealing with new forms. Your Form 1040 now will be “postcard sized,” but you’ll still need to work through pages of schedules to calculate other tax breaks.

Taxpayers will likely have many questions, and getting answers from the IRS will be hard if the shutdown continues.

The Washington Post reports that senior officials in the Trump Administration had not anticipated a long-term government shutdown. Its continuation, the newspaper reports, could delay tax refunds, among other consequences.

According to the Post:

Thousands of federal programs are affected by the shutdown, but few intersect with the public as much as the tax system and the Department of Agriculture’s Supplemental Nutrition Assistance Program, the current version of food stamps.

The partial shutdown has cut off new funding to the Treasury Department and the USDA, leaving them largely unstaffed and crippling both departments’ ability to fulfill core functions.

The potential cuts to food stamps and suspension of tax refunds illustrate the compounding consequences of leaving large parts of the federal govern­ment unfunded indefinitely — a ­scenario that became more likely Friday when President Trump said he would leave the government shut down for months or even years unless Democrats gave him money to build a wall along the U.S.-Mexico border.

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