IRS budget drops from $22.5 billion to $14.2 billion

If you’ve ever considered committing tax evasion, this could be the year to do it, because the IRS might be too understaffed to catch tax dodgers.

The IRS will be staffed at its lowest level since 2019, its budget was slashed by 37%, and employees will decrease by 20% compared to the 2025 fiscal year. According to a report from the Treasury Department, the agency will have 77,728 total employees, a drop from 96,700 last year, and its budget will decline from nearly $22.5 billion to $14.2 billion.

In a May report, The Treasury Inspector General for Tax Administration recorded that 11% of employees left the IRS department in the first quarter of 2025.

With these budget cuts, the IRS plans to trim technology and operations support by 59%, and enforcement employees by 31%. And even with a plan to increase phone operators by 11,158 full-time employees (a 48% increase), the IRS says it’ll only be able to answer 16% of calls during next year’s tax season. So if you need to reach the IRS, plan on getting really sick of its hold music.

This all comes at the same time Congressional Republicans are trying to pass the so-called one big beautiful bill, which would dump additional work on the agency. All in all, according to the Yale Budget Lab, the IRS will miss out on $159 billion in revenue due to the staffing cuts over the next 10 years.