Phoenix Accounting Firm | IRS Budget Cuts
This past week, the Internal Revenue Service released the downside of the cuts to their budget. The Internal Revenue Service received a budget of $10.9 billion. This may seem like a lot of money but it is 3% less than the previous years budget and 12% less than they were requesting for the next fiscal year.
The Internal Revenue Service has already warned taxpayers and tax professionals that they will only be answering about half the calls they receive this upcoming tax season. This is terrible news, especially with all of the uncertainties from the implementation of the Affordable Care Act.
The Internal Revenue Service has also implemented an immediate hiring freeze. This means that even though they are responsible for more, they will not be able to hire the people they need to do it. With the IRS being responsible for the implementation of the Affordable Care Act, it is worrisome to think that they won’t be able to effectively enforce the consequences of not abiding by the law. A spokesman for the Internal Revenue Service warned that, due to these budget cuts, the Internal Revenue Service will be prevented from collecting about $2 billion.
The Internal Revenue Service has also warned taxpayers that they will have to wait even longer to receive their income tax refunds. The Internal Revenue Service claims that they will just not have the resources to get the refunds processed as quickly as in years past.
The Internal Revenue Service is also considering a short-term shutdown of the agency as a way to save money. This would most certainly add even more delays to the start of the tax season. The tax season usually begins in mid to late January, but in recent years has been pushed well into February due to last minute changes to the income tax code.