The Internal Revenue Service (IRS) began laying off employees on Thursday, coinciding with one of the busiest periods of the tax season.
Why It Matters
The layoffs, affecting approximately 6,000 relatively new IRS employees, are part of President Trump’s broader effort to reduce the federal workforce. The move has raised concerns about potential disruptions to tax processing and customer service.
Layoffs Begin in Denver
In Denver, between 120 and 150 IRS employees are being terminated, according to Patricia Allen, president of the National Treasury Employees Union Chapter 32. Most affected workers are probationary employees from various divisions, including collections and tax compliance.
Some employees were notified early Thursday morning, while others waited for an email instructing them to vacate their workplaces within 30 minutes.
“There are many, many, more than 100,000 people working to collect taxes, and not all of them are fully occupied,” said Kevin Hassett, director of the White House Council of Economic Advisers. He suggested that workforce reductions could grow as the agency modernizes its IT systems.
Union Leaders and Employees Speak Out
IRS employees and union leaders have condemned the timing and scale of the layoffs.
• “I’ve been with the IRS for 20 years, and I’ve never seen this kind of layoff. Never,” said Allen.
• Doreen Greenwald, national president of the Treasury Employees Union, called the move a “recipe for economic disaster,” warning that tax processing and customer service would suffer significantly.
• The White House has yet to issue a statement regarding the layoffs or their potential impact on tax season.
Concerns Over IRS Future
Two weeks ago, IRS employees crucial to tax season were informed that they would not be eligible for the administration’s “deferred resignation” program until after the filing period ended. Experts worry that the cuts may slow down tax return processing, exacerbating long-standing staffing shortages at the agency.
Commerce Secretary Howard Lutnick stated Wednesday that Trump’s ultimate goal is to “abolish” the IRS altogether.
Impact on Workers
For many employees, the sudden layoffs have created financial uncertainty.
Arlene R., a Denver-based IRS worker in the special compliance department, had been with the agency for just five months. By Thursday morning, she was anxiously awaiting her termination notice.
“So many of us don’t even know how we’re going to make rent, how we’re going to put food on the table,” she told Axios Denver. “This is just absolutely incredible that one man has this power to do this.”
With tax season in full swing, the full consequences of these layoffs remain to be seen. However, experts warn that processing delays, customer service disruptions, and increased strain on remaining staff could follow in the weeks ahead.
