The Internal Revenue Service (IRS) has previously delayed tax refunds during a government shutdown. The decision comes as United States President Donald Trump weighs declaring an emergency over his demand for border wall funding, the cause of the shutdown. The stalemate over the proposed Mexico border wall is now in its third week.
White House Office of Management and Budget acting director Russell Vought told reporters on Monday that the administration had directed the IRS to fulfil tax returns as officials face mounting pressure to end the federal funding lapse.
“We have tried to make this as painless as possible, consistent with the law,” he said.
US residents are required to file tax papers by 15 April and can later receive refunds from the government based on income. Last year, the IRS issued billions of dollars in refunds – an average of more than $2,000 (£1,600) per filing.
The shutdown, which began on 22 December, has affected 25% of the government and seen some 800,000 federal employees furloughed – temporarily laid off – or forced to work without pay.
It is unclear how the IRS will process returns as about 90% of the agency’s employees remain furloughed. Any IRS employees brought back to process these tax refunds will not be paid until the shutdown ends.
While the shutdown’s repercussions ripple across the country, Vice-President Mike Pence has told reporters the president has not yet decided whether to declare a national emergency in order to bypass congressional approval for the US-Mexico border wall.
Mr Trump is set to address the nation on Tuesday on what he describes as a national security and humanitarian crisis at the southern border. He could direct military construction projects under a national emergency declaration, but the money would have to come from defence funds and would probably face legal challenges from opposition Democrats.
Mr Trump had directed Mr Pence and Democrats to meet over the weekend for negotiations. “The president’s position is: there is a crisis at the southern border, and Democrats are refusing to negotiate,” the vice-president said on Monday.
Mr Pence also said the tax return decision was a part of Mr Trump’s directive to “mitigate the impact of the shutdown on everyday Americans”. As the first tax season under the Republicans’ new tax reform, the president’s party is also under pressure to prove that their legislation has benefited the country.
Mr Trump has repeatedly said he would let the shutdown drag on rather than compromise. On Sunday, he told reporters: “The shutdown could end tomorrow or go on a long time. It really depends on the Democrats.”
Democrats in the House of Representatives, meanwhile, have pushed for legislation without wall funding to re-open the government as the debate continues.