Shutdown Tax Refunds Could Trigger Lawsuits From Unpaid Workers

The IRS’s decision to process tax refunds during a partial government shutdown would require the IRS to call employees back to work without pay and raise the possibility of more shutdown-related lawsuits against the Trump administration.

The decision helps head off potential political pressure on Congress and President Donald Trump to end the shutdown if taxpayers weren’t able to receive their refunds once tax filing season starts in late January. But the announcement also raises a legal question because it contradicts past OMB statements saying the agency couldn’t issue refunds during a shutdown, tax practitioners said.

Their argument is rooted ...