IRS Starts Mass Layoffs: 7,000 Jobs on the Line in 2025.
As of February 20, 2025, the Internal Revenue Service (IRS) has initiated a significant wave of layoffs, with approximately 7,000 employees expected to lose their jobs. This development, reported today by multiple sources, including The Washington Post, comes as part of a broader push by the Trump administration to downsize the federal workforce. The layoffs, which began on Thursday, are shaking the foundations of the tax agency during the critical tax-filing season, raising concerns about disruptions to tax processing and enforcement efforts. With the IRS employing around 100,000 people, this cut represents roughly 7% of its workforce, a move that has sparked both support and alarm across political and economic spheres.
The layoffs primarily target probationary employees—those with less than one to two years of service who lack the job protections afforded to longer-tenured staff. Reports indicate that about 5,000 of the affected workers are from the enforcement and collections division, a section bolstered in recent years under the Biden administration to improve tax compliance among wealthy individuals and corporations. The timing couldn’t be more precarious, as the IRS is currently processing over 140 million individual tax returns ahead of the April 15 deadline. Federal workers and unions have expressed dismay, with some managers reportedly in tears as they delivered the news to staff at IRS facilities nationwide, from New Orleans to Kansas City.
This mass reduction is driven by the Trump administration’s Department of Government Efficiency (DOGE), spearheaded by billionaire Elon Musk. DOGE’s mission is to slash federal spending, with Musk and Trump aiming to cut at least $1 trillion from the $6.7 trillion federal budget. The IRS layoffs follow a pattern of workforce reductions across other agencies, including the National Park Service and Veterans Affairs, with around 75,000 federal employees accepting buyouts earlier this month. Republicans have cheered the effort as a necessary culling of a “bloated” bureaucracy, while Democrats and labor unions argue it undermines critical government functions, particularly at a time when the IRS was beginning to recover from years of underfunding and high attrition.
The impact on taxpayers could be significant. Experts warn that losing 7,000 workers—many of whom were hired to modernize technology and enhance customer service—might delay refunds, slow response times for inquiries, and weaken enforcement against tax evasion. The IRS has made strides in recent years, thanks to $80 billion in funding from the 2022 Inflation Reduction Act, reducing correspondence processing times from seven months to 3.5 months. However, with these layoffs, critics like Rep. Don Beyer (D-Va.) fear a return to inefficiencies, potentially costing billions in uncollected revenue from high-wealth tax dodgers. The National Treasury Employees Union has filed lawsuits to halt the cuts, calling them a “recipe for economic disaster.”
Behind the scenes, the layoffs reflect a strategic shift. The Trump administration has signaled intentions to overhaul or even dismantle the IRS, with Commerce Secretary Howard Lutnick suggesting a future replacement with an “External Revenue Agency” focused on tariffs. This aligns with Trump’s broader economic vision but requires congressional approval, leaving the current cuts as an immediate, tangible action. Meanwhile, the human toll is evident: one laid-off employee, a recent homebuyer, lamented to The Washington Post that she thought her IRS job would be her last, only to be locked out of her work computer with little warning.
Public reaction is mixed. Supporters on platforms like X see it as a “good start” to trimming government excess, while others predict chaos for taxpayers, with one user quipping, “Don’t expect your check too soon!” The layoffs’ geographic spread—hitting states like Texas, New York, and Georgia hard—could ripple through local economies, adding another layer of consequence. As the IRS braces for further potential cuts post-tax season, the agency’s ability to maintain its dual role of service and enforcement hangs in the balance, testing the limits of this aggressive downsizing experiment.
