The Internal Revenue Service (IRS) is preparing for a major reduction in its workforce, with plans to cut up to half of its employees through layoffs, attrition and voluntary buyouts. Currently, the IRS employs around 90,000 workers across the United States.
The move is part of a broader effort by the Trump administration to downsize the federal government and streamline operations.
The proposed cuts could significantly impact its ability to function efficiently. The agency has already laid off approximately 7,000 probationary employees with less than a year of service as of February.
As part of the downsizing initiative, a “deferred resignation programme” has been introduced, offering buyouts to federal employees. However, IRS workers involved in the 2025 tax season have been informed that they cannot accept buyout offers until after mid-May, following the taxpayer filing deadline.
In addition to trimming the workforce, the administration is considering transferring some IRS employees to the Department of Homeland Security (DHS) to assist with immigration enforcement. In February, DHS Secretary Kristi Noem formally requested Treasury Secretary Scott Bessent to allocate IRS workers for this purpose.
The potential impact of these cuts has raised concerns among former IRS officials. A drastic reduction in staffing could make it difficult for the agency to effectively collect taxes and manage its responsibilities. Critics argue that weakening the IRS’s capacity would lead to inefficiencies in government revenue collection.
Federal agencies, including the IRS, have been directed to submit detailed workforce reduction plans by 13 March. However, it remains uncertain if the White House will approve the IRS’ restructuring proposal and how quickly these changes would come into effect. Neither the White House nor the Treasury Department has publicly commented on the plans.
