IRS Slashes Workforce by 25%, Targets Civil Rights Office in Sweeping Cuts The Internal Revenue Service (IRS) has begun eliminating up to 25% of its workforce—approximately 20,000 employees—starting with the closure of its civil rights office, according to agency communications and sources familiar with the plans. The layoffs, part of the Trump administration’s push to shrink the federal government, have sparked fears of reduced tax enforcement and weakened civil rights protections.

First Phase: Civil Rights Office Dismantled The initial wave of cuts focuses on the Office of Civil Rights and Compliance, which will lose 75% of its staff. The remaining employees will merge into the Office of Chief Counsel. The office, previously named the Office of Equity, Diversity, and Inclusion, currently employs fewer than 200 people and enforces anti-discrimination policies for taxpayers during audits and investigations. White House spokesperson Liz Huston framed the move as eliminating “ineffective DEI offices” to prioritize efficiency.

Broader Workforce Cuts and Operational Risks The layoffs extend beyond civil rights staff, with phased reductions across “multiple offices and job categories”. While the Trump administration claims the cuts will not affect tax return processing, experts warn of dire consequences:

• Revenue Losses: A Yale Budget Lab analysis projects an $8.3 billion drop in tax revenue next year due to reduced enforcement capabilities. Over a decade, losses could exceed $159 billion.
• Audit Decline: High-income audits, which recover $4 for every $1 spent, are expected to plummet. Economists fear reduced deterrence against tax evasion.
• Timing Concerns: The cuts coincide with tax season, as the April 15 filing deadline approaches.

Political Backdrop The workforce reduction aligns with President Trump’s executive orders to dismantle DEI programs and Elon Musk’s role in leading government efficiency initiatives. The Treasury Department defended the cuts as necessary for “technological advancements” and reversing Biden-era hiring. However, critics argue the IRS is being stripped of its ability to address systemic inequalities and combat tax fraud.

Employee Uncertainty Affected staff received emails on Friday announcing phased layoffs and early retirement incentives. The IRS recently placed 50 IT security workers on administrative leave, raising concerns about cybersecurity risks during tax season. A federal court had temporarily halted earlier probationary employee layoffs in February, but the latest cuts proceed under new authority.

Broader Implications The IRS cuts follow the elimination of over 200,000 federal jobs under Trump’s downsizing agenda. While proponents emphasize cost savings, opponents warn the move could cripple revenue collection and exacerbate inequities. As Vanessa, a Tax Policy Center fellow, noted: “Cutting the revenue source isn’t the solution if you’re trying to save money”.

The IRS now faces dual challenges: maintaining tax compliance with fewer staff and reassuring a public already anxious about audits and civil rights protections. With the agency’s workforce poised to drop to 70,000 or fewer employees, the long-term impact on federal revenue and equitable enforcement remains deeply uncertain.