IRS chief: Tax-deadline postponement could delay launch of child tax credit program

And Rettig resisted complaints about a backlog of unprocessed tax returns with the agency, citing the coronavirus pandemic and recent tax legislation approved by Congress.

“The importance of overcoming this is not lost to anyone,” he told the Ways and Means Subcommittee on Oversight.

His comments came a day after the IRS announced it would move the prime filing deadline to May 17th from the usual April 15th, amid an unusually difficult filing season for the agency.

The postponement of the deadline was demanded by lawmakers in both parties, and Rettig made it clear that he did not like the idea. This is partly because it would be more difficult for the IRS to launch the new child tax credit program, which will set up a dedicated web portal for beneficiaries that is slated to open for business on July 1, he said.

“The same people who do our income tax processing and stimulus check processing” are the ones who need to develop this portal, so I don’t have the resources to devote to this portal until the filing season ends, “he said.” We now have a month less time for development. “

“We intend to do our best to get there. I hope I don’t have to come to committee to say we can’t meet the legal requirements” to start by July 1st.

The agency may not be able to distribute payments “instantly” monthly, he added, noting that the legislation provides for “regular” payments.

As part of the Democrats’ coronavirus legislation, they significantly expanded the tax credit for children, especially those on low incomes, and ordered the finance department to develop a way that people can take a fraction of the break all year round.

Regarding unemployment benefits, Rettig said the agency is still working on the issues but expects to announce that people who have filed their tax returns earlier this year will not have to change them to get a new tax break the first time receive $ 10,200 in benefits they receive.

“We believe we can do this on our own – we believe we can automatically issue refunds related to the $ 10,200” he said.

Some lawmakers complained that the agency did not extend the deadline for estimated taxes, noting, for example, that they are paid by gig workers. Rettig wasn’t interested.

“There is a large contingent of wealthy people in this country who are failing to make their estimated payments,” he said. “We’re not going to give them a break on interest and penalties.”

The deadline extension is “shelter for the most vulnerable – we’ve only extended the 1040 for individuals,” he said.

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