IRS Experiencing Computer Problems--3rd Update
April 17 2018 - 2:48PM
Dow Jones News
By Richard Rubin
WASHINGTON -- Some IRS computer systems are "experiencing
technical difficulties" on the deadline to pay individual income
taxes for 2017, the U.S. tax agency said Tuesday.
In a statement that didn't specify the extent or cause of the
outage, the Internal Revenue Service said taxpayers should continue
filing returns as usual. The agency is having difficulty receiving
returns from tax preparers, including large companies such as
TurboTax maker Intuit Inc. and H&R Block Inc., acting IRS
commissioner David Kautter told House subcommittees on Tuesday.
Rep. Richard Neal (D., Mass.), said the problem was related, in
part, to the transmission of direct payments to the agency.
"Tax Day is already a stressful time for millions of Americans,
even when everything goes right," said Mr. Neal, the top Democrat
on the House Ways and Means Committee. "Given this news, I hope
that the IRS will make accommodations so that every taxpayer
attempting to file today has a fair shot to do so without
penalty."
TurboTax is still receiving returns and will hold them until the
IRS is ready to accept them again, said Ashley McMahon, a company
spokeswoman.
Most Americans have already filed their 2017 income taxes, but
millions do so in the final days of the filing season. Last year,
between April 14 and April 21, the IRS received more than 17
million returns.
The deadline this year is April 17, not April 15, because of the
weekend and the Emancipation Day holiday in the District of
Columbia.
The IRS has been trying to update its outdated computer systems
for several years, and agency leaders have warned about potential
malfunctions and said they are guarding closely against external
threats.
The problem is believed to be a hardware failure, and the IRS is
rebooting its systems, said a congressional aide familiar with the
matter.
The IRS sent an email at 8:46 a.m. ET Tuesday notifying
accountants and other tax professionals that parts of the
Modernized eFile system, which receives tax returns electronically,
were "unavailable."
The IRS has long operated aging computer systems, and the
agency's leaders have been pressing for updates.
"It is important to point out that the IRS is the world's
largest financial accounting institution, and that is a
tremendously risky operation to run with outdated equipment and
applications," then-commissioner John Koskinen told Congress in
2015. "Our situation is analogous to driving a Model T automobile
that has satellite radio and the latest GPS system. Even with all
the bells and whistles, it is still a Model T."
In a report last year, the Treasury Inspector General for Tax
Administration identified areas for improvement in the agency's
information-technology systems.
"The IRS could better protect IRS systems and data by improving
disaster recovery planning and testing, general support system
security controls, transfers of data to external partners, email
records management, and external network perimeter security," the
report said.
Congress has been steadily cutting the IRS budget or holding it
flat for the past few years, partly in a broader austerity effort
and partly in response to the agency's treatment of conservative
groups seeking tax-exempt status.
Those cuts have reduced the frequency of audits and at times
lowered the IRS's ability to respond to taxpayers' queries.
Congress just approved $320 million for the IRS to implement the
tax law that passed last year.
Write to Richard Rubin at richard.rubin@wsj.com
(END) Dow Jones Newswires
April 17, 2018 14:33 ET (18:33 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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