Will a Government Shutdown Delay Your Tax Refund?

Posted by Madison on April 6, 2011

What happens if there is a government shutdown at the same time you file your tax return? It’s something we might find out this weekend, since there is a possibility of a government shutdown Friday night.

Update: The government has officially shut down as of October 1, 2013. We will continue to monitor the impacts to tax refunds. If you are still waiting on your tax refund see How Long Can the IRS Delay Your Tax Refund?

Right now, as the possibilities of another tax filing delay are on the horizon, it’s hard to tell what exactly might happen. Depending on who you ask, you might get a different answer.

Possible Tax Impacts of Government Shutdown

Based on all of the news reports, here’s a summary of what might happen with your tax return during a government shutdown:

  • The IRS would stop processing paper returns.
  • Efiling would likely continue.
  • Audits will stop.
  • The IRS will stop answering the taxpayer hotline.

However, even if large portions of the the IRS are shutdown, the IRS will still accept payments and you must still file by the tax deadline.

Tax Refund Processing

The biggest question people are likely to ask is if a government shutdown will delay your tax refund. And it could, based on how you file. Here’s what might possibly happen to tax refunds based on earlier predictions:

  • Tax refunds for paper filers will be halted.
  • Tax refunds for efilers will most likely be electronically deposited.

We probably won’t find out exactly what will happen until it occurs, but if you are counting on a tax refund it seems pretty obvious that it would be in your best interest to efile this year.

Of course, whether or not the government shutdown will happen is a whole different can of worms!

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Comments to Will a Government Shutdown Delay Your Tax Refund?

  1. Sounds good.

    Each year, I adjust my withholding to ensure very minimal refund and most years end up writing a check to them. So, delay all you want, stoopid gooberment schlubs . . .


  2. Sounds good, too. We owe taxes every year and this year is no exception. We owe even more this year, and have no intention of filing tonight even if the government shuts down at 12:01am. Since you will be picking up a nice, fat payment from us, I am sure your gargantuan and outdated machine will process our money just fine next week.


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