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Will The IRS Ever Adopt A Flexible Filing Day?

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Tom Herman, over at the Wall Street Journal posted an interesting question recently, asking “Why April 15 Has Lost Its Claim as ‘Tax Day’”

Tom explained that the continuing saga of when the last day to file taxes came on a plethora of matters. Most notably what day of the week April 15 came on in any given year, and occaisonally, the relatively new celebration of Emancipation Day in the District of Columbia.

Seems the tax filing deadline for the entire nation is affected by local DC holidays, and since Emancipation Day is designated as April 16, but if April 16 falls on a weekend, Emancipation day is celebrated on either Friday the 15th, or the the following Monday, the 16th. Thus, depending won whether Emancipation Day falls on a Saturday or Sunday, the filing deadline can be automatically pushed back at least two days.

Let’s don’t even get started on local holidays. For example, taxpayers in Maine and Massachusetts could get a third extra day, depending on when Patriots’ Day observances are held. While many states follow the federal custom, some don’t. When in doubt, check with your state tax department.

Then, the IRS also has the discretion to adjust the filing deadline in areas that have been designated as a federal disaster area. That’s why parts of Texas, Floridaand Louisiana have been given later filing deadlines this year.

Finally, there are a variety of other deadlines for a multitude of taxpayers living and working abroad, as well as members of the military serving in a combat zone.

And then there’s the automatic extension.

For many taxpayers, the April filing deadline is not a deadline for filing a tax return, it is a deadline for filing for their annual automatinc six month extension. (Some folks claim that of life’s two certainties, death and taxes, there is only one that allows an automatic extension. But that only applies to filing, not to paying. Your still have to pay the required amoutn by the deadline.)

Some accountants and others have suggested moving away entirely from April as a filing deadline.

Why not scrap the April T-Day madness? Accountants, enrolled agents and other tax preparers have complained for years about the annual stresses of the April filing deadline, especially since so many perplexed clients wait until the 11th hour to share their shoeboxes stuffed with W-2 forms, 1099s, charitable-giving receipts and stacks of other documents.

Some people have suggested moving the deadline to Election Day—or moving Election Day to April—so that voters will focus more closely on what they get compared with what they pay.

My suggestion would be to scrap the deadline for filing entirely and go to a rolling system where folks only pay if a calculation over a preceding twelve months indicates a balance due, and no return due at other times unless the taxpayer wishes to file for a refund.

A rolling system similar to that would eliminate the seasonal crunch for tax preparers and their ilk, and move tax practices more into the realm of normal business operations with year round operations. It would also level out the workload for the IRS and ease their burden, providing for a more stable, and hopefully, more experienced and efficient workforce.

However, to change the date, congressional action would be required. And the path to congressional action on most tax-related subjects may be one of the few areas at least as complicated as our tax laws themselves.

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Kirk

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