A wave of voluntary departures is sweeping through the Internal Revenue Service, with approximately 20,000 employees—about one-fifth of the agency’s workforce—accepting a buyout offer from the Trump administration. This dramatic shift comes as the administration pursues an aggressive plan to shrink the federal workforce, igniting heated debate about the future of the IRS and federal tax enforcement.

Largest IRS Workforce Reduction in Decades

The buyout, formally known as a “deferred resignation” program, allows employees who accept the offer to remain on paid leave with full benefits until the end of the current fiscal year, September 30. This marks the second major round of such offers in 2025; earlier this year, around 5,000 employees accepted a similar package, and 7,000 probationary workers were terminated. Internal memos indicate the agency is preparing to reduce its headcount from over 100,000 to between 60,000 and 70,000, with further layoffs and attrition possible in the coming months.

Operational Impact and Concerns

The timing of these departures is striking, coinciding with the close of the 2025 tax filing season. As the IRS braces for a reduction of up to 40% of its workforce, concerns are mounting among tax experts and former agency officials. They warn that such steep cuts could cripple the IRS’s ability to process returns, issue refunds, and enforce compliance, potentially costing the Treasury hundreds of billions in lost revenue and accelerating fiscal pressures on Congress to address the national debt.

Key offices within the IRS—such as the Office of Civil Rights, the Taxpayer Experience Office, and the Transformation Strategy Office—are slated for particularly deep cuts or consolidation in the initial phase of the reduction plan. The agency’s acting leadership has indicated that personnel critical to processing current tax returns will be retained through the end of the filing season, but broader service disruptions are anticipated.

Political and Public Reaction

The Trump administration’s downsizing initiative has sparked intense reactions on social media, with some groups calling for the outright abolition of the IRS. However, the current buyouts and layoffs do not signal an official policy move to eliminate the agency. Instead, they reflect a broader strategy to reduce federal expenditures and streamline government operations.

Former IRS commissioners from both parties have publicly criticized the plan, warning that slashing the agency’s workforce could render the IRS “dysfunctional” and ultimately increase the federal deficit by undermining tax collection. Meanwhile, administration officials contend that the number of departures is roughly equivalent to the hiring surge under former President Biden, framing the move as a correction rather than a dismantling.

What’s Next for Taxpayers

With the IRS set to lose a significant portion of its experienced staff, taxpayers may face longer wait times for refunds, reduced access to customer service, and diminished audit and enforcement activity in the coming years. The agency’s leadership transition—awaiting Senate confirmation of a new commissioner—adds further uncertainty.

As the buyouts take effect and the reduction in force notices roll out, the IRS’s ability to fulfill its core mission will be tested as never before. The coming months will reveal whether the agency can adapt to its new, leaner structure—or if the consequences will ripple through the nation’s finances and public services for years to come.