Paying your taxes a certainty during government shutdown
The Pittsburgh (Pa.) Tribune-Review
There's plenty of things people can't do because of the government shutdown — see a national park, get a federal home or business loan, launch a satellite — but paying taxes isn't one of them.
The 11-day-old shutdown left fewer than 10 percent of Internal Revenue Service workers on the job, but 100 percent of taxes are still due. Most federal money pays for things that are not affected by the shutdown, such as Social Security, Medicare and military operations. In fact, the government continues to spend so much money, the shutdown probably won't even cut into the deficit.
“As a citizenry, we're actually getting a pretty terrible deal out of this,” said John Hinshaw, a history professor at Lebanon Valley College.
The only folks likely to get a break from the IRS are tax cheats. The agency said in a document on its website that in most cases seizures “would be extremely limited” during the shutdown.
The Treasury collects about $7 billion a day from income and payroll taxes, most of which are automatically deducted. Regularly scheduled payments to Social Security, Medicare, Medicaid, military salaries and public retirement benefits among others occur on regularly scheduled days.
Social Security payments of $12 billion are scheduled for Oct. 16 and 23, for instance. On Nov. 1, the government will send out about $67 billion in entitlement payments and salaries, according to the Congressional Budget Office.
Furloughing 800,000 or so workers probably won't save taxpayers any money in salaries paid. In previous shutdowns, Congress authorized back pay for those employees once the budget impasse ended, said Sharon Lassar, an accounting professor at the University of Denver.
“We really aren't getting anything out of this,” Lassar said.
Taxpayers might even shell out more in government salaries because of the shutdown, Lassar said. Once those workers return, many will have a backlog of work to process, and that likely will lead to more overtime, she said.
At the IRS, for instance, they'll have to take care of all the refunds they're not sending out during the shutdown.
“Tax refunds will not be issued until normal government operations resume,” the IRS stated on its website.
Meanwhile, the big-ticket items in the federal budget continue to rack up bills. Entitlements, other mandatory expenses and military spending eat about 80 cents of every dollar the federal government spends, according to the CBO. The government also continues to pay federal employees whose furloughs would endanger the public.
“The word ‘shutdown' is something you have to take with a grain of salt,” said Cliff Smith, a finance and economics professor at the University of Rochester's graduate school of business. “It's simply not the case that everything in the government is padlocked, all the lights are turned off, and everybody goes home. The military is still there. The mail is still being delivered. Air traffic controllers are still telling airplanes where to land and when.”
While politicians put on their serious faces, seek out television cameras and denounce their opponents for playing games, playing games is basically what both sides are doing, Smith said.
“Part of what you're seeing is a certain amount of political posturing,” Smith said. “Both sides are trying to make the other's position look unreasonable.”
The Obama administration closed monuments on the National Mall, for instance, but sent Health and Human Services Secretary Kathleen Sebelius to the North Side on Thursday to stump for the health care law with Steelers owner Dan Rooney.
The main reason people continue to pay full freight for a partial government is that the shutdown did not suspend any laws citizens must obey, Smith said.
“Most folks don't look very good in an orange jumpsuit,” Smith said. “The government makes the rules, and the government's got the jails.”