IRS to Lay Off Thousands of Workers Amid Tax Season Shake-Up
Timing: Mid-Tax Season
Agency: Internal Revenue Service (IRS)
Impact: Thousands of Probationary Workers Affected
Major IRS Layoffs Expected Next Week
The Internal Revenue Service (IRS) is set to lay off thousands of probationary workers in the middle of the 2025 tax season, according to sources familiar with the agency’s plans. These cuts could take effect as soon as next week as part of the Trump administration’s aggressive push to reduce the federal workforce.
This move follows a directive ordering federal agencies to dismiss nearly all probationary employees who have not yet gained civil service protection.
🔹 How Many IRS Employees Will Be Affected?
The exact number remains unclear, as IRS and U.S. Treasury officials have not responded to requests for comment.
Federal Workforce Reduction Plan
Earlier, the administration announced a “deferred resignation program,” offering buyouts to nearly all federal employees.
Deadline: February 6
Incentive: Employees who accept the offer can stop working but still receive a paycheck until September 30
However, IRS employees involved in the 2025 tax season were excluded from this buyout offer until after the taxpayer filing deadline (April 15), as outlined in an internal letter to staff.
IRS Facing Workforce Cuts Despite Major Funding Boost
- Start Date: January 27
- Expected Returns: Over 140 million by April 15
The Biden administration had previously invested $80 billion into the IRS through the Inflation Reduction Act, aiming to:
Hire tens of thousands of new employees
Improve customer service and tax enforcement
Upgrade outdated IRS technology
However, Republicans have been actively working to claw back this funding.
Elon Musk & Government Spending Cuts
Billionaire Elon Musk and his Department of Government Efficiency (DOGE) have pushed for massive federal spending cuts, even advocating to eliminate entire government agencies.
Opposition to DOGE’s Plans
A group of 14 state attorneys general has filed a lawsuit, arguing that:
- DOGE’s authority to access sensitive government data is unconstitutional
- Only Senate-confirmed officials should have such power
- Congress—not DOGE—should determine government agency structures
The lawsuit, filed in federal court in Washington, challenges Musk’s role in reshaping federal priorities.
What’s Next?
With potential mass layoffs at the IRS, ongoing political battles, and a high-stakes tax season, this situation is rapidly developing.
Stay tuned for updates as we track the impact on taxpayers, IRS operations, and government workforce policies.
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