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Government Shutdown Jeopardizes 2026 Tax Season, But October Deadline Stands

Q: What measures are being taken to ensure the IRS can function during the shutdown?

The IRS is currently operating under its <a href="https://www.treasury.gov/open/Pages/irs-contingency-plan.aspx" target="_blank" rel="noopener noreferrer nofollow">Lapsed Appropriations Contingency Plan</a>. This plan designates certain employees as essential to continue working, though without pay, to handle critical functions like processing tax payments and securing IT infrastructure. However, with nearly half its workforce facing furloughs, services like taxpayer support and return processing are severely limited.

Q: How might the shutdown affect the IRS's ability to detect and prevent fraud?

A government shutdown can hamper the IRS's ability to combat fraud. While automated fraud detection systems may remain active, the significant reduction in staff means fewer personnel are available to conduct reviews, investigations, and other enforcement activities. This creates a potential window of opportunity for fraudulent schemes to go undetected for longer than usual.

Q: What are the potential long-term effects of the shutdown on the IRS's operations?

The long-term effects could be substantial. A prolonged shutdown could create a massive backlog of unprocessed returns and taxpayer correspondence, similar to what was seen after previous shutdowns. This could delay the start of the 2026 tax season, erode taxpayer trust, and negatively impact the agency's ability to perform its core functions efficiently for months to come.

Q: How are tax professionals preparing for the potential delays caused by the shutdown?

Tax professionals are advising clients to file electronically and as early as possible to get ahead of processing delays. They are also setting expectations that resolving complex tax issues or receiving refunds will take longer. Professional organizations, such as the <a href="https://www.aicpa.org/" target="_blank" rel="noopener noreferrer nofollow">American Institute of CPAs (AICPA)</a>, are publicly calling for measures to lessen the shutdown's impact on taxpayers and the nation's revenue collection.

As the federal government shutdown enters its eighth day, the IRS has begun widespread furloughs, creating significant risks of a delayed start to the 2026 tax filing season. Tax experts warn of processing backlogs and reduced support, though the October 15 filing deadline remains in effect.

Evelyn Park

October 8, 2025

High-resolution image depicting tax documents and a calculator, symbolizing IRS operations and deadlines.

Source:

Kiplinger

Shutdown Casts Shadow Over 2026 Tax Season

The ongoing federal government shutdown, now in its eighth day, directly threatens the timely start of the 2026 tax filing season. Tax experts are sounding the alarm as the Internal Revenue Service (IRS) begins implementing widespread furloughs, a move detailed in the agency’s contingency plans.

This development raises serious concerns about the agency's ability to prepare for the millions of returns expected early next year.

Widespread Furloughs Begin

According to the official IRS shutdown contingency plan, the agency started furloughing a large portion of its workforce on October 8, 2025, after exhausting its supplemental funding. Nearly half of the IRS workforce, totaling around 35,000 employees, may ultimately be furloughed if the shutdown continues.

Why a Delay is Likely

The preparation for a new tax season is a complex, year-round process. Key activities now at risk include:

Finalizing and releasing 2025 tax forms and publications.
Updating and testing e-filing and processing systems.
Training staff on new tax law provisions and procedures.

Without adequate staff, the IRS may be unable to complete these critical tasks, potentially pushing back the official start date of the filing season.

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Clean, high-quality image of financial paperwork with IRS forms, relevant to overdue tax deadlines.

Source:

Kiplinger

IRS Operations Limited, Deadlines Unchanged

Despite the operational disruptions, the IRS has made clear that key deadlines for taxpayers remain unchanged. However, taxpayers should brace for significant service reductions and delays for the duration of the shutdown.

October 15 Deadline Holds Firm

The October 15, 2025, deadline for taxpayers who filed for an extension is still in effect.

The IRS will continue to accept tax returns and payments. It is critical for taxpayers on extension to file by this date, as penalties and interest for late filing and payment will continue to accrue as normal.

Expect Service Disruptions

With a skeleton crew, the IRS's ability to serve the public is severely hampered. Taxpayers should anticipate:

Longer Refund Waits: Processing, especially for paper returns, will be delayed.
Reduced Customer Service: Live phone support will likely be unavailable, and correspondence will go unanswered.
Automated Notices Continue: Automated collection and penalty notices will still be mailed, but taxpayers may be unable to contact the IRS to resolve any issues.

The Treasury Inspector General for Tax Administration (TIGTA) has previously warned that shutdowns lead to backlogs that can take months to clear, impacting service long after the government reopens.

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Well-composed image of the IRS building, relevant to federal operations and government shutdown context.

Source:

MarketWatch

Long-Term Concerns and Expert Warnings

As the shutdown persists, tax professionals and watchdog groups are highlighting the potential for long-lasting damage to the nation's tax administration system. The current disruptions could have a domino effect, impacting not just the upcoming filing season but future years as well.

Backlogs Could Spill Over

A primary concern is the creation of a massive backlog of unprocessed mail and paper-filed returns. TIGTA has noted that such backlogs from previous shutdowns have resulted in significant refund delays and frustrated taxpayers who could not get timely assistance.

"Without sufficient staff, the IRS may struggle to process millions of paper-filed returns, resulting in refund delays and a backlog that could spill into the 2026 season," one TIGTA report highlighted.

Calls for Action

Professional associations are urging a swift resolution. The American Institute of CPAs (AICPA), a leading organization for tax professionals, has called on officials to exempt as many IRS employees as possible from furloughs. The group argues that maintaining a functional tax system is crucial for protecting government revenue and ensuring taxpayer rights.

If a resolution is not found soon, the 2026 tax filing season is likely to be defined by delays, backlogs, and widespread taxpayer frustration.

Long-Term Concerns and Expert Warnings

Backlogs Could Spill Over

Calls for Action

If a resolution is not found soon, the 2026 tax filing season is likely to be defined by delays, backlogs, and widespread taxpayer frustration.

How will the shutdown impact the processing of tax refunds?

Tax refunds will still be issued, but significant delays are expected. The IRS is operating with a reduced workforce due to furloughs, which will slow down the processing of returns, particularly those filed on paper. According to the Treasury Inspector General for Tax Administration (TIGTA), these staffing shortages can lead to backlogs and longer waiting periods for refunds.

How will the shutdown impact the processing of tax refunds?

What measures are being taken to ensure the IRS can function during the shutdown?

How might the shutdown affect the IRS's ability to detect and prevent fraud?

What are the potential long-term effects of the shutdown on the IRS's operations?

How are tax professionals preparing for the potential delays caused by the shutdown?

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