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The IRS lost 31% of its revenue agents and 18% of its revenue officers through March of this year, according to a report by the Treasury Inspector General for Tax Administration (TIGTA). The losses could significantly impair the IRS’s ability to identify and go after tax dodgers: Revenue agents examine tax returns for possible violations, and revenue officers collect delinquent taxes.
The IRS also lost 10% of its tax examiners, the front-line workers who process tax returns, and 10% of its customer service personnel in that same period, the report showed.
The TIGTA report examined the effects of the first few rounds of DOGE buyouts and job cuts on the IRS. All told, the agency lost around 11,000 people, or about 11% of its workforce, through March. At least 7,315 probationary employees were fired in January, and 4,128 staffers took deferred resignations within the first three months of the year, TIGTA found.
These job cuts affected some of the IRS’s business units more than others. Its tax exempt and government entities unit was hardest-hit percentage-wise, losing 694 people, or slightly less than a third of its workforce (31%). Its large business and international unit lost 1,733 employees, or 25% of its workforce, and its small business/self employed unit lost 5,765 personnel, or 23% of its workforce. Taxpayer services lost 4% of its personnel, or 1,714 people.
Legislation is pending that could reverse some of the job cuts, though the Supreme Court paused a ruling by federal courts that would require agencies to rehire fired probationary workers.
Cuts could lead to noncompliance, revenue losses: TIGTA’s report didn’t examine effects of the workforce reductions that began in April. More than 23,000 IRS employees have applied for the Treasury Deferred Resignation Program, TIGTA noted. About 13,000 of them were approved to resign as of April 22. TIGTA plans further reports on these and future IRS job cuts.
Further job losses could be on the horizon. An internal memo seen by CBS News and the Federal News Network showed that the Trump administration’s goal is to whittle the IRS down to 60,000–70,000 people, a 30%–40% reduction in its size.
Treasury Secretary Scott Bessent argued that the reduction in force was “just taking the IRS back to where it was” before a surge in hiring during the Biden administration “substantially bloated the personnel and the infrastructure,” Bloomberg reported. The IRS workforce grew from around 79,000 to more than 102,000 people during Biden’s term, a spokesperson for the Treasury Department told CBS News. Some of that hiring, enabled by funding from the Inflation Reduction Act, happened to help the IRS deal with a massive backlog of around 20 million pieces of taxpayer correspondence, and to process pandemic-era relief programs, according to the AP.
The IRS job cuts could prove a serious blow to the federal budget. The Yale Budget Lab estimates that a loss of around 18,000 IRS personnel would lead to a $159 billion loss in revenue over 10 years, according to Bloomberg.
If enforcement suffers, taxpayers may be tempted to cheat on their taxes, or to avoid paying them altogether, the Yale Budget Lab wrote. The IRS is losing “the very staff trained to keep high-end taxpayers and corporate taxpayers in compliance,” Emily DiVito, senior advisor on economic policy at Groundwork Collaborative, told CBS. The reduction in force, she noted, “simply doesn’t make sense” if saving money is the goal.