IRS Faces Unprecedented Staff Loss: What It Means for Taxpayers in 2025
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The Internal Revenue Service (IRS) is bracing for a dramatic reduction in staffing—nearly 20,000 employees have accepted a deferred resignation offer, putting the agency on track to lose close to one-third of its workforce this year.
This wave of departures follows the reopening of the Deferred Resignation Program, which allows employees to receive full pay and benefits through September 30, 2025, in exchange for resigning. Many of the participants are seasoned employees over the age of 40, some using the offer as a backup plan in case they are affected by a future reduction in force (RIF).
What’s Behind the Mass Departure?
This initiative is part of the Trump-era Department of Government Efficiency strategy to reduce the size of the federal workforce. Although the IRS had over 100,000 employees at the end of fiscal year 2024, these resignations—along with the loss of 7,000 probationary employees already on administrative leave—could shrink the agency’s headcount to just 70,000.
That number would erase most of the hiring gains made under the Inflation Reduction Act, which had aimed to modernize the IRS and improve taxpayer services.
What This Means for You
Former IRS officials have expressed serious concerns about the significant reduction in the agency's workforce, emphasizing that the loss of approximately 20,000 employees could severely hinder IRS operations. The departure of essential IT personnel further threatens the IRS’s readiness for upcoming tax seasons, while overall staff reductions could result in billions in lost tax revenue and diminished enforcement capabilities.
With the IRS rapidly losing critical personnel:
Expect slower response times to IRS letters and taxpayer requests
Amended returns and claims for refunds may take months longer to process
Identity theft and fraud cases may not be resolved in a timely manner
The IRS may struggle to enforce collections or audits effectively
Taxpayer rights may be at greater risk due to service gaps
Don’t Wait for the IRS to Catch Up
If you’ve received a notice from the IRS or are facing a tax issue—now is the time to act. The window to resolve your matter efficiently is shrinking, and the IRS will only become more overwhelmed in the coming months.
At Ruth Tax Law, we help clients nationwide with:
IRS audit defense
Tax debt and collections relief
Innocent spouse and identity theft claims
Amended returns and refund disputes
Appeals and installment agreements
Schedule a consultation today to resolve your IRS matter quickly and correctly.
Work with a real tax attorney who knows how to get results.
Olena Ruth | Tax Defense Attorney
Olena represents the taxpayers in federal and state tax audits, collection matters, administrative appeals, and the U.S. Tax Court’s cases. She is actively engaged in Tax Sections of the American Bar Association and Colorado Bar Association. She serves as Colorado Bar Association’s pro-bono attorney and liaison to the Internal Revenue Service. Her speaking engagements include presentations on tax matters in family law, employment tax issues, and communication with the IRS.
Olena can be reached at olena@ruthtaxlaw.com
