IRS could cut up to 40% of workforce, memo indicates
The IRS is planning to cut up to 40% of its workforce after Tuesday marked the official end of
tax filing
season, according to an internal memo obtained by CBS News that has circulated among IRS employees this week.
The memo said that the IRS will send Reduction in Force (RIF) notices on a biweekly basis. The RIF plan also states the agency will go from 102,000 employees to its targeted "ending figures" of 60,000 to 70,000. News of the memo was first reported by the
Federal News Network
.
There was a deadline of April 14 from the Office of Personnel Management for agencies to submit RIF plans for their approval. It is not known yet if the IRS's plan has been fully approved by the Treasury Department or OPM.
April 15 marked the official deadline for
most taxpayers
to file taxes, though if a taxpayer is
granted an extension
, they have
until Oct. 15
to file without penalty.
According to the memo, the IRS will have two RIF phases, with an evaluation of the first phase to be conducted in August. In a list of "core functions" at the agency, the Office of Civil Rights, the Taxpayer Experience Office, the Transformation Strategy Office and the Online Services Office are designated to have a "high" level of cuts during phase one, according to the memo. In phase two, those offices are listed as "Consolidate."
The memo also states that there will be a "high" level of cuts for "taxpayer services and compliance" employees during phase two. "Career executives" will also undergo another RIF in between the two phases, according to the memo.
In response to the memo on the RIF plan, a Treasury spokesperson wrote that the reductions "currently being considered" at the IRS are "part of — and driven by — process improvements and technological innovations that will allow the IRS to collect revenue and serve taxpayers more effectively."
"The roll back of wasteful Biden-era hiring surges, and consolidation of critical support functions are vital to improve both efficiency and quality of service. The Secretary is committed to ensuring that efficiency is realized while providing the collections, privacy, and customer service the American people deserve," the spokesperson added.
The goal of the cutbacks could be helped by over 20,000 IRS employees who are expected to leave the agency through the IRS's own Deferred Resignation Program offer, known as DRP 2.0, according to multiple sources familiar with the situation. This was
first reported by Bloomberg Tax
.
Acting commissioner Melanie Krause and other senior leaders
have opted into that program
, and could leave the agency as soon as April 28.
When asked about the 20,000 leaving via the DRP 2.0, the Treasury spokesperson pointed to the Biden administration growing the IRS by over 22,000 employees through
$80 billion in funding
from the Inflation Reduction Act.
"Under new leadership, approximately the same number of employees have left the IRS, with a vast majority leaving voluntarily through the Deferred Resignation Program," they said.
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