About 22,000 employees at the Internal Revenue Service have signed up for the Trump administration’s latest resignation offer. This exodus could weaken the agency’s ability to collect taxes, as the I.R.S. had about 100,000 employees before President Trump took office. Since January, roughly 5,000 employees have resigned, and an additional 7,000 probationary employees were laid off, although these firings have been contested in court. If these layoffs take effect, the agency could lose about a third of its workforce this year.
The terms of the Trump administration’s deferred resignation offer state that employees who take the deal will be put on paid administrative leave through September before leaving their federal jobs. Some employees who accepted the offer may still choose to opt-out of resigning. Losing a third of I.R.S. staff is expected to decrease the amount of revenue the federal government can collect. Cuts have already led the I.R.S. to abandon some audits, and taxpayers may feel more emboldened to avoid paying taxes with a diminished I.R.S. workforce.
The Biden administration had previously expanded the I.R.S. by about 20,000 employees in an effort to increase tax revenue collection. A spokesperson for Treasury Secretary Scott Bessent stated that the department aims to reverse the hirings from the previous administration while still improving service. The spokesperson emphasized the Secretary’s commitment to ensuring efficiency and providing the collections, privacy, and customer service that the American people deserve.
One of the resigning I.R.S. officials is the acting commissioner, Melanie Krause. She and other top I.R.S. officials made the decision to leave the agency partly due to an agreement to share taxpayer information with Immigration and Customs Enforcement. The Trump administration’s use of I.R.S. data to assist in deporting undocumented immigrants has caused widespread concern among employees, as the I.R.S. has historically maintained the confidentiality of taxpayer information.
The exodus of I.R.S. employees puts the agency at risk of further layoffs and funding cuts, potentially exacerbating the challenges in tax collection. The cuts have already led to the abandonment of some audits, which could allow taxpayers to avoid paying taxes more easily. Prior to these resignations and layoffs, the I.R.S. had been working to increase tax revenue collection under the Biden administration’s expansion plan, which aimed to strengthen the agency’s enforcement capabilities.
As the I.R.S. grapples with significant workforce reductions, the impact on tax collection and enforcement remains a concern. The loss of experienced employees and potential future layoffs could hamper the agency’s ability to carry out its responsibilities effectively. With the Biden administration’s efforts to reverse previous hirings while improving service, the future of the I.R.S. and its ability to collect taxes effectively amid dwindling resources is uncertain.
