IRS furloughs some employees, closes most operations

The IRS began furloughing employees on Wednesday as the government shutdown entered its second week, the agency said in a message posted on its website and directed to employees.

“Due to the lapse in appropriations, most IRS operations are closed,” the message said. All employees were to report for their next scheduled workday, when they would be given up to four hours to close out their work and receive furlough notification, it said.

The furlough applies to “everyone except already-identified excepted and exempt employees,” the message said, without identifying how many people remain on the job.

Over 74,000 IRS employees kept working for the first five days of the shutdown, which began Oct. 1, under the agency’s contingency plan. The plan had not been updated as of midday Wednesday, and the IRS had posted no statements other than the one addressed to employees.

Under its contingency plan, the IRS used money from the Inflation Reduction Act of 2022, P.L. 117-169, to remain fully staffed.  Federal employees who work during a shutdown are not paid until the shutdown ends.

The IRS’s original Inflation Reduction Act funding, $79.4 billion over 10 years, was reduced to $37.6 billion through congressional cuts as of March, according to an August report by the Treasury Inspector General for Tax Administration. As of March 31, the IRS had spent about $13.8 billion of that funding, the report said.

AICPA advocacy

The AICPA had urged the IRS to keep all employees on the job, regardless of the shutdown’s length, because of Oct. 15 tax deadlines and the guidance needed for the new tax law, H.R. 1, P.L. 119-21, commonly known as the One Big Beautiful Bill Act.

— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.