• The IRS is planning to cut its workforce by as much as 50%, according to multiple sources.
• Layoffs will involve a mix of attrition, incentivized buyouts, and significant cuts to probationary employees.
• Experts warn that such drastic reductions could make the IRS dysfunctional in its operations.
• The White House is evaluating the proposals, with reports due by mid-March.

The IRS is actively drafting plans aimed at reducing its workforce by up to half, which has ignited considerable concern among experts regarding the agency's functionality. Reports indicate that the cuts will primarily affect its approximately 90,000 employees through a combination of layoffs, attrition, and incentivized buyouts, as discussed by sources familiar with the situation under the Trump administration's directives. Following a strategy set forth by billionaire Elon Musk's Department of Government Efficiency, the IRS has already laid off around 7,000 probationary employees who lacked civil service protections, and it plans further significant reductions to expedite the downsizing of the federal workforce, as noted by the HuffPost.

Former IRS commissioner John Koskinen echoed concerns, stating that a workforce reduction of this magnitude would leave the agency “dysfunctional.” The IRS has stated that around 56% of its employees are people of color and 65% are women, indicating wide-ranging impacts on diverse communities if such mass layoffs proceed. As the agency navigates these shifts, it is also compelled to restrict buyouts for staff involved in the coming tax season until after the mid-May filing deadline Los Angeles Times.

In addition to direct layoffs, the administration has plans to repurpose some IRS personnel for tasks related to immigration enforcement under the Department of Homeland Security, complicating the agency's capacity further. Critics, including six other former IRS commissioners alongside Koskinen, argue that such aggressive reductions in resources will diminish the government's ability to effectively collect taxes Newsweek.

A White House memo outlined expectations for federal agencies to report on their reduction plans by March 13, yet the timeline for these IRS changes remains shrouded in uncertainty. Officials from the White House, Treasury Department, and IRS have not commented publicly regarding the ongoing deliberations.