The Internal Revenue Service is undergoing one of the largest workforce reductions in its history, and experts warn the cuts could delay tax refunds and severely impact customer service for American taxpayers.
According to a report from Kiplinger, more than 11,400 IRS employees have either accepted buyouts or been terminated as part of the Trump administration’s initiative to shrink the federal workforce. The layoffs include thousands of tax return processors and call center staff, raising concerns about the IRS’s ability to assist taxpayers and issue timely refunds.
2025 tax season ends, but disruptions remain
Although the 2025 tax season officially concluded in April, the effects of ongoing layoffs are expected to ripple through the summer. Thousands of workers, originally told to stay through May 15 to support peak filing season operations, are now being extended through June 30, with some set to enter administrative leave starting July 1.
The Treasury Inspector General for Tax Administration (TIGTA) reports that nearly 5,000 employees were approved for the agency’s Deferred Resignation Program. Many of them worked in critical departments such as Taxpayer Services, which handles returns and answers taxpayer inquiries.
Probationary workers and new hires hit hardest
In addition to the voluntary departures, the IRS issued termination notices to 7,315 probationary employees, most of whom had been with the agency for less than one year. Legal challenges briefly paused the terminations in March, but most workers were later let go again.
Demographics show a skew toward younger employees:
- 549 were under age 25
- 3,466 were aged 25–39
- Over 6,600 had one year or less of IRS service
More layoffs coming this summer
The IRS has confirmed that layoffs are not over. A second round of buyouts under the Treasury Deferred Resignation Program (TDRP) approved 13,124 employees for separation as of late April.
In parallel, a reduction-in-force (RIF) is underway across several departments, including the Office of Civil Rights and Compliance and the Taxpayer Experience Office. TIGTA says staffing will be slashed in those units by up to 75%, potentially affecting how the IRS handles appeals, complaints, and taxpayer outreach.
What this means for your tax refund
While the IRS says most e-filed refunds are processed within 21 days, this year’s workforce losses may slow operations. Taxpayers should prepare for longer delays—particularly for paper returns or those flagged for additional review.
You can check your federal refund status using the IRS’s Where’s My Refund? tool. To use it, you’ll need:
- Your Social Security number
- Filing status
- Exact refund amount
The system updates daily and provides three possible statuses: return received, refund approved, or refund sent.
For state refunds, most states offer similar online portals, such as those for New Jersey and Pennsylvania.
Key IRS refund timelines (2025)
Here are estimated refund dates based on when your return was accepted:
- Filed by April 7
- Direct deposit: by April 28
- Paper check: by June 6
- Filed by April 15
- Direct deposit: by May 6
- Paper check: by June 16
If you haven’t received your refund within these timeframes, the IRS advises calling 800-829-1954.
What’s next for the IRS?
Before the layoffs, the IRS had more than 103,000 employees—its highest headcount in 30 years. Now, the agency is operating with significantly fewer staff, and further cuts are expected.
Former President Trump has proposed replacing the IRS with a tariff-based “External Revenue Service.” While the idea remains in its early stages, the future of the IRS appears uncertain. As of mid-May, the Senate has not confirmed a new IRS commissioner.
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