With the current federal government shutdown, many small business owners are wondering: “Will the IRS delay tax deadlines or reduce my filing obligations?” The answer is: No. Even though many IRS services are curtailed, the underlying tax laws and deadlines for small businesses remain in full force. IRS+2TaxAct Blog+2

That means it’s more important than ever for your business to stay on top of tax filings, payments, bookkeeping and communications — and to adjust your strategies for the temporary disruptions in IRS operations.

In this post we’ll walk through:

  1. What the shutdown means for small-business tax operations
  2. Key tax deadlines that still apply
  3. Practical actions your business should take now
  4. How to document and mitigate risk given slower IRS response
  5. Why proactive planning matters ahead of year-end

1. What the Shutdown Means for Small Business Tax Operations

Here are the major effects of the shutdown as they relate to tax-compliance for small businesses:

  • Even under the shutdown, the IRS continues to accept electronic filings and payments — the tax law hasn’t been “paused.” TaxAct Blog+1
  • However, live support, in-person taxpayer assistance centers, phone lines and many correspondence responses are very limited or suspended. Latham & Watkins+1
  • Refunds for error-free electronically filed returns with direct deposit are still being processed. IRS+1
  • But processing of paper filings, audits, appeals and certain notices may be delayed. TaxAct Blog+1
  • The shutdown does not extend filing or payment deadlines unless Congress explicitly grants relief. IRS+1

Bottom line: Your small business still has the same tax responsibilities, but you may face longer wait times for IRS responses or unusual delays.

2. Key Deadlines and Obligations That Still Apply

As a small business, you should keep in mind the following:

  • Payroll taxes, including deposits and returns (e.g., Form 941, Form 940) remain due as normal. The shutdown does not remove or delay these obligations. IRS
  • Corporate income tax returns, partnership returns, S-Corp returns still must be filed by their due dates (including extensions).
  • For businesses that filed an extension (for instance for tax year 2024), the extended deadline remains in place — it’s not automatically moved. TaxAct Blog
  • Make your tax payments when due. Interest and penalties may accrue even if IRS processing is slower. TaxAct Blog
  • Maintain your bookkeeping and document retention; audits and inquiries may still occur, regardless of staffing levels.

Given the limited IRS resources, it’s wise to be extra careful with timely filing and accurate records — delays in IRS contact mean you want fewer reasons to need additional correspondence.

3. 5 Practical Actions Your Small Business Should Take Now

Here are targeted steps you and your firm can take — these are perfect to distribute to clients or include in your blog-newsletter to show your advisory value:

  1. Prioritize electronic filing & direct deposit
    If you file electronically and choose direct deposit for any refund, you reduce risk of further delay. As noted, paper filings and checks may face longer processing. TaxAct Blog+1
  2. Check your year-end bookkeeping now
    With fewer services available at the IRS, any mistake or missing record may take longer to resolve. Ensure bank reconciliations are done, payroll deposits are accurate, and your general ledger is up to date.
  3. Review upcoming tax payments
    If your business has an estimated payment coming (for example for corporate tax) or upcoming payroll tax deposit, mark the calendar and make the payment on time — since no automatic extensions are currently in effect.
  4. Document communication and receipts
    If you receive any IRS notice or correspondence, send it timely (certified mail if needed) and keep proof. Even if responses are delayed, you’ll want evidence you submitted on time. Given limited staffing, your documented trail may help ward off penalties or disputes. EisnerAmper
  5. Use this pause to plan ahead
    The slowdown in guidance and IRS operations (especially with major tax reforms pending) means this is a good time to revisit entity structure, tax-planning moves, and ensure you have a cushion for any unexpected issues. Plante Moran

4. Risk Mitigation in a Sluggish IRS Environment

When the IRS can’t respond quickly, small businesses face certain elevated risks. Here’s how to manage them:

  • Delayed notices: If the IRS eventually sends a notice months later, having clean records and documentation pays off. Encourage clients to maintain easy-to-access file systems and to mark key filings.
  • Audit backlog: Although enforcement may be reduced temporarily, it may rebound later when backlog clears. Ensure your clients’ returns are as accurate as possible now.
  • Cash-flow implications: If refunds are delayed or adjustments are postponed, businesses should maintain liquidity. For example: don’t assume a refund will hit in X days — plan for a buffer.
  • Legislative uncertainty: Tax law changes (such as from the One Big Beautiful Bill (OBBB)) may be delayed due to shutdown-related guidance backlogs. That means planning earlier is even more beneficial. Plante Moran

5. Why Year-End Tax Strategy Is More Vital Than Ever

Because filing deadlines remain fixed and IRS service is restricted, this juncture presents both challenge and opportunity for your small-business clients:

  • If your clients act now to pull forward deductible expenses, review entity structure, optimize payroll, or finalize equipment purchases before year-end, you strengthen their tax position while minimizing surprises.
  • Your services become more valuable — not just filing returns, but proactive advisory on bookkeeping, tax planning, year-end closes, and cash-flow management.
  • Use this blog post itself as a piece of marketing: you can link to it from email-alerts, social posts ("What every PA business owner should do now") and position yourself as the local expert who will guide them through “tax season in an unusual year”.

Conclusion

The federal government shutdown may be creating headaches for the Internal Revenue Service — but it doesn’t relieve your business of its tax duties. For small businesses in Pennsylvania (and beyond), the rules are unchanged, the deadlines unchanged, and the need for diligence unchanged.

What is changed is the environment: reduced service, potential delays, less wiggle room. That means your tax-game must be sharper. If you haven’t yet reviewed your bookkeeping, scheduled your year-end tax planning meeting, or double-checked your payroll deposits and tax payments — now is the time.

If you’d like assistance, my firm (Cloonan CPA Services) is offering a year-end tax-check and preparedness review for small business clients. We’ll walk through your books, identify potential deductions, ensure you're ready in this environment of uncertainty, and help you stay ahead of the shutdown-related delays. Contact us to schedule a 30-minute consultation.

‍