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Tax Filing Season Delayed to January 31

By December 19, 2013Businesses, Individuals

A 16-day shutdown of the government in October has resulted in the IRS delaying the tax filing season to January 31.  This will create some of the same headaches taxpayers and preparers endured last year when a last minute fiscal cliff deal delayed the opening of tax season.  The people it will hurt the most are those hoping to get their refunds early.

The IRS may be playing it safe with the 2014 tax season launch after last year.  They started accepting returns at the end of January, 2013 but could not process many returns with special items like education credits until much later.  The government has a bit of a black eye right now when it comes to software roll-outs, so the IRS will no doubt take their time in testing the software to prepare to file tax returns for the 2013 year.

There have been some significant changes this year as well.  In addition to the higher tax rates called for by the fiscal cliff deal, there are also limitations on exemptions, itemized deductions, and the new 3.8% Medicare tax for upper income earners.  Each of these changes will need to be implemented and tested in the IRS software.

The IRS has not extended the filing deadline.  Returns must still be filed by April 15th or extended.  Taxpayers are allowed a six month extension on their individual returns if they can’t meet the April 15th deadline, however there is no extension on time to pay your tax bill.

It is possible that filing will open up for businesses sooner than the January 31 start date, and many software vendors (including ours) will accept returns before that date and then hold them until the IRS is ready.  We will keep you posted with any additional updates.

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