Treasury Would Continue Operating Debt Programs in ShutdownIan Katz
The U.S. Treasury would continue operating debt programs and managing its cash if the government shuts down next week, the department said today.
The Internal Revenue Service would stop responding to taxpayer questions by telephone, the Treasury said in a blog post. The IRS also would halt “non-automated collections and tax-processing activities, but would continue activities necessary for the protection of government property.”
The Senate voted today to finance the government through Nov. 15 after removing language to choke off funding for President Barack Obama’s health-care law, putting pressure on the House to avoid a federal shutdown set to start Oct. 1. The vote was passed on a party-line vote of 54-44.
People with IRS appointments related to audits, collections, appeals or taxpayer-advocate cases “should assume their meetings are canceled” if the government closes and will be rescheduled later, according to the blog post. The IRS is a bureau of the Treasury Department.
The Treasury’s fiscal service would maintain payments, collections and daily cash management. “This includes resources to support disbursements of interest on the debt, disbursements of Social Security and other federal benefits, and maintaining critical government-wide accounting activities,” the department said.
Mark Zandi, chief economist at Moody’s Analytics Inc., estimates a three-to-four week shutdown would cut growth by 1.4 percentage points. Zandi projects a 2.5 percent annualized pace of fourth-quarter growth without a shutdown. A two-week shutdown could cut growth by 0.3 percentage point to a 2.3 percent rate, according to St. Louis-based Macroeconomic Advisers LLC.