IRS Layoffs: Agency Cuts Thousands Amid Tax Season Chaos and Security Concerns

Key Takeaways

• The IRS began mass layoffs, starting with an office losing 75% of its staff.
• Cuts are expected to impact up to 25% of total personnel, or 20,000–25,000 jobs.
• The IRS-Criminal Investigation Division, responsible for major tax and drug crime cases, is also facing reductions.
• The layoffs arrive less than two weeks before the tax filing deadline, risking service delays and weakened enforcement.
• IRS leadership remains in flux, with political and legal battles over staffing decisions ongoing.

IRS Begins Mass Layoffs Ahead of Tax Deadline, Cuts Target Civil Rights and Criminal Units

The Internal Revenue Service (IRS) has begun issuing layoff notices as part of a sweeping reduction in force (RIF) that could slash nearly 25% of its 90,000-person workforce. The layoffs come at the height of tax filing season and amid growing concerns over enforcement capability and national security.

According to internal communications, the first wave of layoffs has gutted the IRS Office of Civil Rights and Compliance, which lost 75% of its staff on Friday. More phases are expected in the coming weeks.

What the IRS Layoffs Mean

The IRS described the layoffs as part of a plan to “increase efficiency and effectiveness” in line with President Trump’s executive order on government workforce reductions. However, the sudden job cuts, especially during tax season, are raising alarm among former IRS officials and lawmakers.

“It’s a risky move to lay off nearly 10% of the agency’s workforce during filing season,” said a former IRS commissioner. “The system is fragile, and this adds unnecessary stress.”

Employees laid off through the RIF will have 30–60 days’ notice. Others are being offered early retirement and buyout incentives. The agency has also placed a freeze on most reassignments and relocations.

IRS Criminal Investigations Unit Faces Cuts

One of the most controversial targets of the cuts is the IRS Criminal Investigation Division (IRS-CI). This elite unit plays a vital role in:

• Investigating financial crimes, tax evasion, and money laundering
• Leading efforts against drug and human trafficking
• Partnering with other federal agencies to track terrorism financing

In 2024, IRS-CI:

• Initiated 2,667 criminal investigations
• Secured 1,571 convictions (90% conviction rate)
• Identified $9.1 billion in tax and financial fraud
• Collected over $1 billion in restitution
• Seized $1.2 billion in criminal assets

Yet despite this return on investment, DOGE (Department of Government Efficiency) is pushing to cut CI staffing, prompting bipartisan backlash.

“CI was responsible for taking down the largest fentanyl trafficking operation in U.S. history,” wrote Senate Finance Committee members in a recent letter. “These cuts threaten public safety and national security.”

Trump’s Role in the Cuts

The IRS grew under the Biden administration following an $80 billion boost from the Inflation Reduction Act. But since returning to office, President Trump has frozen remaining funds and ordered a hiring freeze that only applies to the IRS. He also removed IRS Commissioner Danny Werfel, replacing him with former Rep. Billy Long, pending Senate confirmation.

In January, the IRS terminated over 6,600 probationary employees, though a federal court has temporarily blocked the move. Another 4,000 staff accepted deferred resignations, while approximately 50 IT security personnel were placed on leave last week.

Public Impact and What Comes Next

Although the Trump administration claims tax processing staff will not be affected, insiders worry that layoffs will inevitably cause delays in refunds, slower enforcement, and reduced capacity to detect fraud.

The IRS has not released a full layoff schedule but confirmed that multiple offices and job categories will be affected. Employees are being asked to upload updated resumes to determine reassignments during the reduction process.

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