The Internal Revenue Service will remain open for business next Monday, July 22, 2013, despite a previously scheduled furlough day.
The furlough was to be the fourth in a series of five furlough days this season. The first three of those days went on as planned on May 24, June 14 and July 5. On those days, the IRS was closed for business. The agency cited funding challenges as the reason for the shutdowns.
The furlough days – unpaid days for all IRS employees – were implemented as a result of budget concerns, including the sequester. They were controversial since on those days, the IRS shut down completely leaving taxpayers and practitioners without access to IRS resources, including the Taxpayer Advocate Service and taxpayer assistance centers. Offices were closed, returns were not processed and refunds were not issued. The temporary closures, together with staffing shortages, contributed to long hold times and delays in responding to written correspondences.
Last week, acting IRS Commissioner Danny Werfel indicated to his employees that the remaining furlough days might be canceled in exchange for not issuing a number of planned bonuses. The bonuses – also called performance awards – were a sore spot with many in Congress who questioned the move in light of a directive from the Obama administration for agencies to cancel discretionary bonuses because of automatic spending cuts. Werfel eventually announced that bonuses for managers would be cut and bonuses for senior executives were being examined but he could not commit to withdrawing bonuses for union employees which had been characterized as a legal obligation under a collective bargaining agreement.
As yet, there has been no official statement from the IRS as to exactly how the budget was retooled in order to send its roughly 100,000 employees back to work. A message on the IRS web site from Werfel said simply, “This step follows a lot of hard work across the Service to cut costs.”
The IRS has not yet announced whether the next scheduled furlough day, planned for August 30, will occur. I’ll keep you posted!
