Key Takeaways

• The IRS is operating at half capacity as roughly 34,000 employees have been furloughed during the government shutdown that began on October 1, 2025.
• Electronic filing and payments continue as normal, but audits, taxpayer phone support, and correspondence are on hold until the government reopens.
• Taxpayers who filed extensions until October 15 should still file and pay on time. The IRS continues to process returns, but delays in confirmations or refunds are likely.
• Dental practice owners can expect slower IRS communication and potential backlogs, but filings submitted electronically remain secure.
• For current Edwards & Associates clients, no action is required. Our team continues managing all submissions and monitoring IRS updates on your behalf.
• If you aren’t yet a client, reach out to us to talk about working with a firm experienced in managing filings during government shutdowns and IRS delays.

The federal government shutdown, which began on October 1, 2025, is not significantly impacting the IRS.

On October 8, the agency furloughed nearly half of its 74,000 employees after using leftover Inflation Reduction Act funds to stay open for the first few days of the shutdown. What does that mean for taxpayers, especially dental practice owners who filed extensions and are approaching the October 15 deadline? In short, the IRS is still accepting returns and payments, but response times and certain processes are already slowing down. Here’s what we know and what we don’t.

What’s Still Running

While roughly 34,000 employees are furloughed, the IRS is keeping some “excepted” operations active, including:

• Electronic filing and payment processing, which continue automatically
• Limited computer systems maintenance to prevent data loss or system failure
• Criminal investigations and disaster relief processing which fall under essential services.

Everything else, from taxpayer assistance lines to audit reviews and correspondence, is on hold. That means if your return needs manual review, or if you’re waiting on a reply or refund check, you can expect delays. 

What This Means for Dental Practices

For our clients, the good news is that we’ve already submitted or are finalizing your extension returns, and those filings are being processed electronically. The IRS’s digital systems are still functioning, and electronic payments continue to post normally.

However, some ripple effects are possible in the weeks ahead:

• Delayed confirmations or correspondence from the IRS, especially for returns that trigger additional review
• Longer response times to questions, adjustments, or refund requests
• Potential backlog growth that could affect future filings if the shutdown lasts several weeks.

In other words, your filings are safe, but don’t expect the usual pace of communication or updates from the IRS until the government reopens.

What We Don’t Yet Know

Like much of the tax community, we’re still waiting for clarity on:

• How quickly furloughed employees will return once funding is restored
• Whether the backlog will affect next year’s filing season
• Whether certain enforcement or compliance activities will be delayed or compressed later in the year.

The Taxpayer Advocate Service is also shut down during the furlough, removing one of the few safety valves for those caught in IRS delays.

What Our Clients Should Do

If you’re already a client of our firm, rest assured: we’re monitoring developments daily and will reach out if anything changes that could affect your filings, payments, or correspondence with the IRS. You don’t need to take any action right now. Our team will continue managing everything on your behalf and keeping you informed.

If you aren’t currently working with us but are concerned about your upcoming filing or payments, now is the time to line up a tax advisor who understands the system and how to navigate unexpected disruptions like this one. While we can’t help new clients with their 10/15 filings, we’re here to assist with future extension filings, electronic submissions, payment verification and tracking, and IRS correspondence once operations resume.

Hang Tight

The IRS shutdown is another reminder of how unpredictable the tax landscape can be. For most dental practices, this won’t create immediate problems, but it does underscore the value of having a team that stays ahead of every detail, especially when communication with the IRS is limited.

At Edwards & Associates, we keep a close eye on developments like these, so you don’t have to. If you have questions about your filing, or if you’d like to make sure your tax plan is protected no matter what happens in Washington, our team is just a call or email away.