Tax Season to Start on Time

For most of us, anyway

By Kaye A. Thomas
Posted December 28, 2007

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IRS says processing will be ready except for those using certain forms.

In the course of the political jockeying over legislation to prevent expanded application of the alternative minimum tax (the so-called AMT patch) we learned that late action by Congress on this issue would force the IRS to delay the start of the 2008 filing season, potentially delaying tax refunds for millions of early filers. This news did little to spur action from our elected representatives, as Senate Republicans refused to permit a vote on legislation acceptable to Democrats, and House Democrats refused, until the last day of the legislative session, to accept the reality that there was no way to break the Republican filibuster. Congress finally passed the legislation, but without allowing adequate time for the IRS to prepare for a filing season based on an altered tax law.

An earlier assessment of the situation indicated the filing season would be delayed for all taxpayers. The thinking was that even simple returns would be affected because the IRS has to run them through a computer program that checks to see whether the taxpayers might have overlooked the need to pay AMT. The IRS now says it expects to open the filing season on time for most taxpayers. They'll be ready to process returns on January 14, as originally planned, except for returns that include the following five forms:

  • Form 8863, Education Credits
  • Form 5695, Residential Energy Credits
  • Form 1040A’s Schedule 2, Child and Dependent Care Expenses for Form 1040A Filers
  • Form 8396, Mortgage Interest Credit
  • Form 8859, District of Columbia First-Time Homebuyer Credit

A Wall Street Journal report on the IRS announcement incorrectly says the IRS won't be able to process "AMT-related" returns until February 11. The IRS says there will be no delay in processing Form 6251, used to calculate AMT, and Form 8801, used to calculate AMT credit. Computer programming and testing for the forms listed above won't be completed until February 11, though, and the IRS won't begin processing returns that include those forms until that date even if the credits are not actually affected by AMT.

You may be thinking you can move things along by filing on paper ahead of that date. The IRS indicates your best bet for a quick refund on a return including one of these forms is to wait until February 11 and file electronically. Paper returns including those forms will be set aside if filed before February 11, and returns filed electronically are processed much faster than paper returns.

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