The Internal Revenue Service (IRS) is in the process of developing a comprehensive plan aimed at significantly reducing its workforce. This strategy involves a combination of layoffs, natural attrition (employees leaving on their own), and incentivized buyouts (offering employees financial incentives to resign voluntarily). This information comes from two sources who wished to remain anonymous due to restrictions on their authorization to publicly disclose these details.
The Administration’s Strategy for Reducing Federal Employees
This move to cut down the IRS workforce is part of a broader initiative by the Trump administration, which seeks to reduce the overall size of the federal government. This initiative is directed by Elon Musk’s Department of Government Efficiency, which focuses on enhancing government efficiency by minimizing bureaucracy. The strategy includes closing various federal agencies, dismissing nearly all probationary employees who lack civil service protections, and introducing a “deferred resignation program.” This program offers financial incentives to a broad swath of federal employees, encouraging them to leave their positions sooner than planned, thereby accelerating the reduction in government staffing levels.
Impact of Reductions on IRS Functionality
The potential impact of these workforce reductions on the IRS’s functionality is significant. John Koskinen, a former IRS commissioner, has voiced concerns that these cuts could render the IRS “dysfunctional.” The IRS, which currently employs approximately 90,000 people across the United States, plays a crucial role in tax collection and enforcement. The workforce is notably diverse, with people of color making up 56% and women comprising 65% of its employees. Already in February, around 7,000 probationary IRS employees with less than one year of service were laid off. Moreover, a plan has been put forward to offer buyouts to IRS employees, although those involved in the 2025 tax season have been informed that they cannot accept these buyouts until mid-May, following the deadline for tax filing.
Additional Administrative Actions
Beyond the workforce reductions, the Trump administration is also planning to utilize IRS employees in other government areas. Specifically, there is a proposal to lend IRS personnel to the Department of Homeland Security (DHS) to assist with immigration enforcement efforts. This request was outlined in a letter from DHS Secretary Kristi Noem, who asked the Treasury Secretary Scott Bessent for additional support in bolstering immigration controls.
Uncertainty Surrounding the Implementation of Reduction Plans
As part of the administrative procedure, the White House has directed all federal agencies, including the IRS, to develop and submit a report by March 13 detailing their respective plans for workforce reductions. However, it remains unclear whether the White House will approve the IRS’s reorganization plan and the timeline over which these changes would be implemented. Representatives from the White House, the Treasury Department, and the IRS have not responded to requests for comment, adding to the uncertainty surrounding the future of these plans. This lack of communication has raised questions about how and when the proposed reductions will affect the IRS and its ability to fulfill its critical functions.
