IRS Commissioner John Koskinen recently wrote a letter to U.S. Senate Finance Committee Chairman Ron Wyden detailing his concerns that the 2015 tax filing season will be delayed if Congress doesn’t take action on extenders. These are tax provisions that expired at the end of 2013, and the commissioner said Congress needs to decide whether to extend them before the end of November.
“The IRS is currently facing a great deal of uncertainty related to the expired tax provisions, which raises serious operational and compliance risks,” Koskinen wrote. “Continued uncertainty would impose even more stress not only on the IRS, but also the entire tax community, including tax professionals, software providers and tax volunteers, who are all critical to successful operation of our nation’s tax system.”
He went on to say a delay for the 2015 filing season could occur if decision-makers don’t determine whether to continue the extenders by December. Depending on what decision is made regarding the extenders, the IRS might have to make processing changes and update its systems. Furthermore, the consequences could be more dire if Congress makes a decision in 2015 and applies it retroactively to 2014, resulting in millions of amended returns.
Avoiding a delay for the second consecutive year
In October 2013, the partial government shutdown delayed many governmental departments due to reduced staff, including the IRS. As a result, the 2014 filing season had to be pushed back so the agency could check its systems and ensure it was ready to process tax information.
Koskinen, who hadn’t been installed as commissioner when last year’s delay occurred, echoed former acting IRS Commissioner Danny Werfel, noting fall and summer are key preparation periods for the agency. If action is taken now, the agency won’t have to backtrack to make adjustments based on Congress’s rulings on the extenders.
Wyden issued a statement in response to Koskinen’s letter, urging Congress to heed the commissioner’s warning.
“According to the IRS, the longer Congress delays action the greater risk that the tax filing season and millions of taxpayer refunds will be delayed, among other serious disruptions,” Wyden said. “Congress needs to act swiftly on these important tax provisions so it can get to work on a comprehensive overhaul of the tax code and lift the fog of uncertainty from taxpayers.”
