Silent Returns Will Be Processed February 20, 2017

As a result of the President’s executive order on January 20, 2017, the IRS recently confirmed here that “silent” returns will be processed, both electronically and on paper. A silent return is the term the IRS is using to refer to individual returns where:

1. The box on Form 1040, Line 61 indicating full year coverage is not checked, and
2. There is no Form 8965 attached claiming exemption(s) to health coverage, and
3. No shared responsibility payment has been computed.

The IRS announcement also seems to indicate refunds will not be withheld in these cases. This really gives the IRS two alternatives:

1. Use Exam or CP 2000 Letters to address these returns down the road, or
2. Simply ignore the issue.

At this point, it doesn’t appear that the IRS knows what approach they will be taking, as the announcement said, “The IRS is currently reviewing the Jan. 20, 2017, executive order to determine the implications.”

Meanwhile, return software companies seem to be split on the issue. Some are saying they will change their software to allow silent returns, and others are saying they have no plans to change their software, as the law has not changed.