The Internal Revenue Service (IRS) is preparing to reduce its workforce by up to 50%, potentially affecting approximately 45,000 employees. This initiative aligns with the Trump administration’s broader strategy to decrease the federal workforce, led by Elon Musk’s Department of Government Efficiency (DOGE).
In February 2025, the IRS initiated layoffs of approximately 7,000 probationary employees, each with less than a year of service. Additionally, a “deferred resignation program” has been introduced, offering buyouts to employees willing to leave voluntarily. However, employees involved in the 2025 tax season have been restricted from accepting buyouts until after the mid-May filing deadline.
The administration also plans to reassign some IRS employees to the Department of Homeland Security (DHS) to assist with immigration enforcement. DHS Secretary Kristi Noem formally requested IRS personnel for this purpose in February 2025.
Former IRS Commissioner John Koskinen and six other former commissioners have expressed concerns that such significant reductions could impair the agency’s ability to function effectively. They argue that deep cuts to the IRS workforce could weaken tax enforcement, leading to reduced revenue collection and larger federal budget deficits.
The IRS is required to submit a workforce reduction plan to the White House by March 13, 2025, as part of a broader federal downsizing initiative. However, it remains uncertain whether the plan will be approved or how quickly it would be implemented. If approved, tens of thousands of employees could face layoffs, buyouts, or reassignment in the coming months, potentially impacting taxpayer services and enforcement efforts.
