IRS lays off 6,700 employees, torpedoing Democratic enforcement boost
The IRS fired 6,700 employees Thursday, a government official told NewsNation, the sister television network of The Hill.
The employees were designated as probationary, meaning they were working for the agency on a trial basis prior to becoming full staff members.
More than 5,000 of the fired staff members were auditors and collection staff dealing with tax compliance issues, the official told NewsNation.
The White House, Treasury Department and IRS did not respond to questions from The Hill regarding the specifics of the firings.
But Kevin Hassett, chair of the White House Council of Economic Advisers, told reporters at the White House on Thursday that the decision was motivated by government efficiency concerns.
“I think our objective is to make sure that the employees that we pay are being productive and effective. And there are, many, more than 100,000 people working to collect taxes. And not all of them are fully occupied. And the Treasury secretary is studying the matter and feels like 3,500 is a small number, and probably you can get bigger as we improve the IT at the IRS," Hassett said.
Republicans have been gunning for the IRS since Democrats gave the agency an $80 billion funding boost in 2022 as part of the Inflation Reduction Act (IRA).
As soon as they took control of the House in 2023, Republicans voted to rescind the funding in a measure that didn’t make it through the Senate, which was then controlled by Democrats.
But Republicans were still able to claw back a quarter of the IRA funds through appropriations fights over the course of 2023 and 2024.
They also managed to freeze an additional $20.2 billion of the funding boost allotted specifically for increased audits, effectively torpedoing Democrats’ goal of increasing enforcement on the wealthy and corporations.
The 5,000 fired compliance staff lines up closely with the number of new auditors the agency had hired with the IRA money for increased enforcement.
The IRS hired 495 tax enforcement personnel in fiscal 2023 and 4,088 enforcement personnel in fiscal 2024 for a total 4,583 new agents, so firings result in more than 400 fewer auditors than before the IRA passed.
After mistakenly being granted access to sensitive Treasury Department payment systems earlier this year, officials from the so-called Department of Government Efficiency were reported to be gaining access to the IRS in recent days, raising concerns about having access to sensitive networks and huge amounts of private taxpayer data.
One Congressional Republican aide told The Hill that IRS officials aren’t concerned about protecting taxpayer information, but maintaining their turf.
There are “tons of internal problems with how the IRS agency leadership determines who can and cannot have access,” the aide said.
Democrats blasted the firings on Thursday.
“In the middle of tax season, under the deceitful guise of ‘efficiency,’ the President and his reckless billionaire Cabinet are purging the agency responsible for processing Americans’ returns, issuing timely refunds, and holding wealthy tax cheats accountable. This isn’t about efficiency; it’s about giving a free pass for the Administration’s rich friends,” House Ways and Means Committee ranking member Richard Neal (D-Mass.) said in a statement.
Professionals in the tax world also criticized the layoffs, calling them “misguided.”
“These misguided layoffs will hurt everyday Americans who pay their taxes and count on the IRS to pay refunds on time while encouraging wealthy people and large businesses to cheat on their taxes,” Chye-Ching Huang, director of the NYU School of Law Tax Law Center, said in an email to The Hill.
Some IRS staff appeared to take to social media this week to voice their frustrations.
“If you are in collections or something like that, I would expect to get terminated this coming week,” a Reddit user posted to the social media site’s “govfire” channel Sunday. The user described themself as “a 21-year employee with the IRS.”
Another user said IRS employees who answer phones in the taxpayer services department wouldn’t be let go in the middle of tax season.
“We were told in a meeting at work, those of us in Taxpayer Services are 'essential' until May 15th, and would have to work through a government shutdown,” one Reddit user wrote Sunday.
Treasury Department employees in the National Treasury Employees Union (NTEU) also voiced their concerns about being fired this week.
“You’re not alone in this,” Shannon Ellis, president of the NTEU’s chapter 66 in the Kansas City area, said in a social media post about the firings. “I know it feels that way, but we’re there. We’re there with you.”
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