By: HUB’s EB Compliance Team
As part of a government shutdown, some of the U.S. federal government workers are placed on furlough. As a result of the furlough, many federal government agencies, including those that oversee employee benefits issues, operate with skeleton staffs, including the IRS. With several IRS deadlines looming and ACA penalty letters arriving on a regular basis, some employers may be wondering if a shutdown (and resulting furloughs) means deadlines are extended. The answer is no.
Whether all or only a portion of the government is shutdown, that does not change an employer’s compliance obligations. Deadlines still apply. This includes items such as:
- Filing ACA reporting forms (which the IRS announced, during the 2018-2019 shutdown, would start to be accepted on January 17, 2019).
- Forms W-2 and other tax filing deadlines. To that point, the IRS recently announced that income tax filing season will begin on January 28, 2019 and that it would recall a "significant portion" of its workforce back to work without pay.
- Responding to IRS Letters 226J or government audit requests. Even if the IRS agent on that case is not available during the shutdown, the deadline still applies. Employers should consult with counsel on how to approach this if they need an extension during a shutdown.
- Distributing employee communications, like summaries of benefits and coverage (SBCs) or notices of marketplace coverage options.
Additionally, make no mistake: after a shutdown ends, the federal government has full authority to enforce penalties (like those for ACA reporting forms) for missed deadlines.
Having said that, if a shutdown creates an issue with compliance, the government may provide some relief. For example, if the IRS’s electronic system for receiving ACA forms goes down and the IRS is not able to fix it due to a shutdown, the IRS may give employers additional time to file. However, absent unusual circumstances like those, we do not expect government agencies to extend deadlines solely due to a shutdown.
NOTICE OF DISCLAIMER
The information herein is intended to be educational only and is based on information that is generally available. HUB International makes no representation or warranty as to its accuracy and is not obligated to update the information should it change in the future. The information is not intended to be legal or tax advice. Consult your attorney and/or professional advisor as to your organization’s specific circumstances and legal, tax or other requirements.