Three former IRS leaders used the AICPA National Tax Conference in 2025 to flag a pressing question for taxpayers and advisers: what happens if the government shuts down during filing season? Their message, delivered to an audience of accountants and policy watchers in Washington, put the agency’s future and operational resilience in the spotlight as the 2025 filing season approaches.
The panel outlined concerns about service levels, technology upgrades, and contingency planning. They also addressed the stakes if a funding lapse strikes when millions of returns start rolling in. The timing could shape refund flows, enforcement decisions, and the pace of ongoing modernization projects.
Context: Funding, Technology, and a Tight Timeline
The IRS is in the middle of a multiyear push to modernize its systems and improve service. The drive includes expanded digital tools, more online accounts, and broader scanning of paper forms. Funding from the Inflation Reduction Act set these plans in motion, though some of that money has since been reallocated by Congress.
The agency’s recent progress includes shorter phone wait times and more in-person assistance. It has also pledged to reduce paper backlogs through a paperless processing initiative. But many core systems are old and fragile. Large changes must be phased in carefully, especially when filing season workloads peak.
Against that backdrop, even a short shutdown could create ripple effects. The IRS receives tens of millions of returns in the first weeks of filing. Refunds fuel household spending, and delays can strain families who rely on that cash. Tax professionals also face compressed timelines if the season starts late or services pause midstream.
What a Shutdown During Filing Season Would Mean
Past funding lapses offer a guide to potential disruptions. During the 2018–2019 partial shutdown, the government remained closed for 35 days. The IRS initially operated with minimal staff, later recalling employees to open the filing season. Processing continued, but the agency struggled with backlogs and lower service capacity.
If a shutdown coincides with 2025 filing, similar challenges could surface. The agency would need to decide which tasks are essential and which must pause. That could affect phone service, correspondence, audits, and systems testing.
- Refund timing could slip if processing slows.
- Taxpayer assistance may be limited or delayed.
- Technology rollouts and fixes could be deferred.
- Collection and enforcement activity might narrow to urgent cases.
Taxpayers with tight cash flow, small businesses filing quarterly payments, and practitioners managing heavy workloads would feel the pinch first. Electronic systems can keep receiving returns, but human support often determines how fast problems get solved.
Voices From the Stage
“Three former IRS leaders, speaking at the 2025 AICPA National Tax Conference, discussed the agency’s future and what happens if a shutdown occurs during filing season.”
The discussion centered on readiness and expectations. While detailed contingency plans are not public, the panel’s focus signaled concern about a funding lapse intersecting with peak operations. Their emphasis on planning suggests the agency is preparing for several scenarios, from a brief pause to a longer disruption.
Implications for the Industry and Taxpayers
Accounting firms may need to adjust engagement timelines, prioritize early filings, and prepare for longer notice-to-response cycles with the IRS. Software providers could see higher support demand if e-filing surges while human assistance declines. Low-income filers, families claiming credits, and gig workers may face more uncertainty.
There is also a policy risk. A disrupted filing season could weaken trust and complicate enforcement goals meant to narrow the tax gap. It could slow modernization projects, which depend on steady funding and testing windows that often occur right before filing begins.
What To Watch Next
Several indicators will hint at the path ahead. Congressional budget talks will determine whether a shutdown occurs and how long it might last. The IRS will signal whether opening day for filing changes and whether contingency staffing is in place. Practitioners will look for guidance on amended returns, identity verification, and correspondence pauses.
Early communication can reduce bottlenecks. Clear notices about what will continue and what will pause can help filers plan. Steps like filing early, using direct deposit, and checking online accounts may help taxpayers navigate any delays.
The takeaway is plain: a shutdown during filing season would test the IRS’s modernization gains and its ability to maintain service at scale. The panel’s warning sets expectations for a bumpy start if funding falters. Stakeholders should monitor budget talks, prepare for schedule shifts, and watch for agency updates on refund timing and support channels. If Congress avoids a shutdown, the 2025 season could be a test of the IRS’s new tools under normal strain. If not, resilience and clear messaging will decide how well the system holds.
