The Treasury Inspector General for Tax Administration (TIGTA) began a review of the IRS to update its previous report on the tax agency's initiatives toward workforce reduction. The new report offers a view of the IRS business units and positions affected as of May 2025.

TIGTA found that IRS actions have caused about a 25 percent reduction of its workforce. The National Taxpayer Advocate recently reported that, not having improved technology in place, the IRS staffing cuts could make the upcoming filing season more difficult. The National Taxpayer Advocate also stated, “to deliver a successful filing season, the IRS needs a sufficient number of trained employees to program its processing systems, develop and disseminate timely and clear guidance on tax law changes, answer telephone."

Part of the IRS efforts to reduce the size of the federal government’s workforce is offering deferred resignation programs (DRP). These programs let federal workers to resign with pay through Sept. 30, or later, if the worker’s retirement date is between Oct. 1 and Dec. 31, 2025. The IRS also provided Voluntary Early Retirement Authority (VERA) and Voluntary Separation Incentive Payment (VSIP) to incentivize workers to leave federal service.

Added to this, in April 2025, the IRS started Reduction in Force (RIF) actions to further downsize its workforce. 

Based on IRS records, 25,386 workers separated, took a DRP offer, or utilized some other incentive to leave. Another 294 employees were sent termination notices because of RIF actions. These departures is 25 percent of the IRS’s workforce and affect certain business units more than others.

The separations also affected employees in certain positions (e.g., job series). For instance, roughly 27 percent of tax examiners separated, while 26 percent of revenue agents separated. Tax examiners are responsible for reviewing and processing federal tax returns to ensure compliance and accuracy. Revenue agents conduct examinations (audits) by looking at financial records of individuals and businesses as a verification of what it reported.