Thousands of employees at the Internal Revenue Service have lost their jobs in recent months. That reduction in the workforce could affect the agency’s essential functions — from audits and collection enforcement to the processing of tax returns and refunds — during the height of tax season.
In February, an estimated 6,000 to 7,000 probationary workers were laid off from the IRS, and reports have indicated the agency may cut as much as half of its roughly 90,000-person workforce in the coming months. On March 13, a federal judge ordered the administration to reinstate thousands of probationary employees it had fired from government agencies, including the IRS, but the final number of layoffs at the IRS will depend on the final court rulings.
Layoffs could have financial consequences for the IRS, which said it collected more than $5.1 trillion in tax revenue during fiscal year 2024. The agency has been trying to solve the so-called tax gap, which is the amount of money that is owed to the IRS every year but goes unpaid. Figures from the latest IRS data and official testimony estimate the tax gap to be around $600 billion to $1 trillion per year.
Click here to read the rest of the article written by Jeff Huang over at CNBC
