Urgent Information: 2014 Tax Season Will Be Delayed According to the IRS

The IRS backlog due to the recent government shutdown appears to be serious.  Here is information which was in my in-box directly from the IRS from yesterday late afternoon.

 

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2014 Tax Season to Start Later Following Government Closure; IRS Sees Heavy Demand As Operations Resume

 

WASHINGTON–The Internal Revenue Service today announced a delay of approximately one to two weeks to the start of the 2014 filing season to allow adequate time to program and test tax processing systems following the 16-day federal government closure.

The IRS is exploring options to shorten the expected delay and will announce a final decision on the start of the 2014 filing season in December, Acting IRS Commissioner Danny Werfel said. The original start date of the 2014 filing season was Jan. 21, and with a one- to two-week delay, the IRS would start accepting and processing 2013 individual tax returns no earlier than Jan. 28 and no later than Feb. 4.

The government closure came during the peak period for preparing IRS systems for the 2014 filing season. Programming, testing and deployment of more than 50 IRS systems is needed to handle processing of nearly 150 million tax returns. Updating these core systems is a complex, year-round process with the majority of the work beginning in the fall of each year.

About 90 percent of IRS operations were closed during the shutdown, with some major workstreams closed entirely during this period, putting the IRS nearly three weeks behind its tight timetable for being ready to start the 2014 filing season. There are additional training, programming and testing demands on IRS systems this year in order to provide additional refund fraud and identity theft detection and prevention.

“Readying our systems to handle the tax season is an intricate, detailed process, and we must take the time to get it right,” Werfel said. “The adjustment to the start of the filing season provides us the necessary time to program, test and validate our systems so that we can provide a smooth filing and refund process for the nation’s taxpayers. We want the public and tax professionals to know about the delay well in advance so they can prepare for a later start of the filing season.”

The IRS will not process paper tax returns before the start date, which will be announced in December. There is no advantage to filing on paper before the opening date, and taxpayers will receive their tax refunds much faster by using e-file with direct deposit. The April 15 tax deadline is set by statute and will remain in place. However, the IRS reminds taxpayers that anyone can request an automatic six-month extension to file their tax return. The request is easily done with Form 4868, which can be filed electronically or on paper.

IRS processes, applications and databases must be updated annually to reflect tax law updates, business process changes, and programming updates in time for the start of the filing season.
The IRS continues resuming and assessing operations following the 16-day closure. The IRS is seeing heavy demand on its toll-free telephone lines, walk-in sites and other services from taxpayers and tax practitioners.

During the closure, the IRS received 400,000 pieces of correspondence, on top of the 1 million items already being processed before the shutdown.

The IRS encourages taxpayers to wait to call or visit if their issue is not urgent, and to continue to use automated applications on IRS.gov whenever possible.

“In the days ahead, we will continue assessing the impact of the shutdown on IRS operations, and we will do everything we can to work through the backlog and pent-up demand,” Werfel said. “We greatly appreciate the patience of taxpayers and the tax professional community during this period.”

IRS Delays PTIN Renewals for Tax Professionals Due to Shutdown

The Internal Revenue Service has delayed the 2014 season for renewing Preparer Tax Identification Numbers because of the government shutdown that ended 10/17/2013.

 

On a Web page that the IRS set up to provide updates on how the shutdown is affecting the agency, the IRS recently added the question, “What is the status of renewing Preparer Tax Identification Numbers (PTIN) for 2014?”

The online PTIN system is still available for users to log in and view or change information or to secure a PTIN for 2013. Additional information will be provided on this site as it becomes available.”

You can access the page for renewing a PTIN for next tax season, click here,

Health Insurance on Delay for Employers, Official Notice from the IRS

Washington, D.C. (July 11, 2013)

By Michael Cohn

The Internal Revenue Service has issued a formal notice that officially delays the employer shared responsibility provisions of the Affordable Care Act, also known as the employer mandate, for a year and postpones the information reporting requirements.

 

The White House and the Treasury Department posted announcements about the delay last week on blogs (see Obama Administration Delays Employer Mandate for Affordable Care Act). But the new Notice 2013-45 from the IRS formalizes and further explains the transition relief.

The announcement gives larger employers an additional year to comply with the health care reform law. The requirements will instead begin in January 2015 for employers with 50 or more full-time employees (or the equivalent in full- and part-time employees) to offer quality affordable health insurance to employees or face a $2,000 fine per employee if the employee receives a premium tax credit for purchasing individual coverage on one of the upcoming health insurance exchanges.

The IRS said in the notice that the transition relief will provide additional time for input from employers and other reporting entities in an effort to simplify information reporting consistent with effective implementation of the law. “This transition relief also is intended to provide employers, insurers, and other providers of minimum essential coverage time to adapt their health coverage and reporting systems,” said the IRS. “Both the information reporting and the Employer Shared Responsibility Provisions will be fully effective for 2015. In preparation for that, once the information reporting rules have been issued, employers and other reporting entities are encouraged to voluntarily comply with the information reporting provisions for 2014.”

The Obama administration emphasized that the delay came in response to demands from businesses to provide more time to adjust to the new requirements.

The IRS added that the transition relief through 2014 for the information reporting and Employer Shared Responsibility Provisions has no effect on the effective date or application of other Affordable Care Act provisions.

The Obama administration still plans to open the health insurance exchanges, or marketplaces, on Oct. 1. It recently shortened the 21-page application for health insurance into a three-page application to make it easier for taxpayers to apply for coverage. House Republicans have introduced legislation once again to try to repeal the Affordable Care Act and have begun pushing the Obama administration to delay the individual mandate for buying health insurance now that the employer mandate has been delayed.