As the government shutdown grinds into its third week, millions of Americans are facing a collision of deadlines and disruptions—none more pressing than Wednesday’s tax extension deadline. Despite the halls of Congress echoing with partisan deadlock and nearly half of Internal Revenue Service (IRS) employees sent home, the IRS has made one thing abundantly clear: taxes are still due, shutdown or not.
For the more than 20 million taxpayers who filed for an extension back in April, the clock is ticking. According to the IRS, these filers have until October 15, 2025, to submit their 2024 income tax returns or risk penalties. That’s over 12% of all filers this year—a record number, as reported by Money and Nexstar. The agency’s message, echoed by spokesperson Anthony Burke, is unequivocal: “Filing and payment requirements under the Federal tax law remain unaffected by the current lapse in appropriations.”
But what does this mean for the average taxpayer, especially when federal operations are hobbled and IRS offices are running on a skeleton crew? The IRS contingency plan, released in early October, states that 53.6% of its staff—about 40,000 employees—are still working, with the rest furloughed. Taxpayer services are being prioritized, but enforcement divisions have seen deep cuts. The National Treasury Employees Union has warned that, “Taxpayers around the country will now have a much harder time getting the assistance they need, just as they get ready to file their extension returns.”
The shutdown’s effects are rippling far beyond the IRS. Smithsonian museums are shuttered, airports are experiencing delays, and hundreds of thousands of federal employees are feeling the pinch of missed paychecks. Young government workers, in particular, are anxious. Emily Gross, a furloughed IRS employee, shared her concerns with WTOP: “A lot of the employees are young. They can’t pay rent if they don’t get one paycheck. They just don’t have that much money in savings; they’re at the beginning of their careers. I just don’t think it’s right.” Gross added, “It’s been hard to be a federal employee this entire year.”
Political leaders are locked in a standoff. House Republicans, having passed a clean continuing resolution, are waiting for Senate Democrats to move, while Democrats insist on permanent enhancements to health insurance tax credits and the restoration of Medicaid cuts before lending their support. House Majority Whip Tom Emmer put it bluntly: “The House has done its work. House Republicans are ready to get back to work and finish the people’s business as soon as Chuck Schumer and Democrats in the Senate reopen the government.” On the other side, House Minority Leader Hakeem Jeffries shot back, “Why are they all on vacation in the middle of a government shutdown? We are willing to sit down and evaluate in good faith anything that could advance the ball here for working class Americans, middle class Americans, and everyday Americans.”
Amidst all this, President Donald Trump has threatened a 100% tariff on China and new export controls on critical software, responding to China’s own export restrictions on critical minerals. Trump’s social media post assured, “Don’t worry about China, it will all be fine! Highly respected President Xi just had a bad moment. He doesn’t want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!!!” In addition, a 25% tariff on medium and heavy-duty trucks is set to begin November 1, 2025, following a Department of Commerce investigation into their impact on national security.
Back at the IRS, leadership changes are underway. Frank Bisignano, previously commissioner of the Social Security Administration, has been tapped as the new CEO, overseeing day-to-day operations while continuing his SSA duties. Jarod Koopman steps in as acting chief tax compliance officer, and Derek Theurer takes on the role of deputy Treasury secretary. Treasury Secretary Scott Bessent, currently acting as IRS commissioner, highlighted a glimmer of fiscal good news: the federal budget deficit for the year ending September 30, 2025, was $1.8 trillion—just $8 billion less than last year, but the deficit-to-GDP ratio dropped to 5.9% from 6.4% in 2024.
For taxpayers still scrambling to file, electronic systems remain fully operational. The IRS Free File program, available to those earning under $84,000, will accept returns until midnight local time on October 15, while Free File Fillable Forms are open to all income levels through October 20. Payments, whether sent electronically or by mail, will continue to be processed. Tax attorney Adam Brewer advised Nexstar readers, “If at all possible, file electronically, and request that you receive your refund by direct deposit. I know no one really loves to give their banking information to the IRS or to the state, but if you want your refund quickly, you have to give them the direct deposit information.”
Miss the deadline, though, and the consequences are clear. Late-filing penalties and interest start to accrue immediately—0.5% of your unpaid balance per month, up to a maximum of 25%. And it’s worth remembering: the extension granted in April only gave more time to file, not to pay. Any taxes owed were due months ago.
There are a few exceptions. Taxpayers in Arkansas and Tennessee, hit by severe storms in early April, have until November 3, 2025, to file. Those affected by terroristic actions in Israel throughout 2024 and 2025 have until September 30, 2026, to file returns and make payments, according to recent IRS guidance. The agency has also extended deadlines for those impacted by storms, flooding, tornadoes, and droughts across various states. For Americans living abroad, an automatic two-month extension applies.
The IRS has released updated guidance for the coming year, including inflation-adjusted tax items for 2026 and interim rules for the new Corporate Alternative Minimum Tax. There’s also transitional relief for remittance transfer providers adjusting to a new 1% excise tax effective January 1, 2026. Plus, a revised Form W-9 is in the works, requiring additional information from sole proprietors and digital asset brokers.
Meanwhile, the shutdown’s human toll continues to mount. Vice President JD Vance has warned that more cuts to the federal workforce could be on the horizon if the stalemate drags on. Some federal workers fear they may not receive back pay, despite a 2019 law requiring it—though senators on both sides have sought to reassure employees that pay will eventually be restored. As one IRS worker put it, “Congress is being paid, and they had no say in this. I don’t think it’s fair.”
With the October 15 deadline looming, the message from the IRS is as clear as ever: government shutdown or not, your taxes are due. For millions of Americans, the pressure is on—and the hope is that the political impasse in Washington will break before the nation’s civil servants and taxpayers feel even greater strain.
