The U.S. Internal Revenue Service is set to lay off approximately 6,700 employees on Thursday, according to an insider.
According to Reuters, the restructuring of the IRS could potentially strain the agency’s resources during the tax-filing season. The workers affected are probationary employees who have typically been with the IRS for less than one to two years and have fewer protections than more senior staff members. The IRS employs around 100,000 people in total.
The IRS’s reductions are part of a wider effort to downsize federal government personnel, initiated by President Donald Trump and spearheaded by Tesla and SpaceX CEO Elon Musk. The initiative aims to streamline the bureaucracy.
Recently, the Office of Personnel Management, which oversees federal hiring, instructed agencies, including the IRS, to dismiss all probationary employees.
According to the insider who spoke to Reuters, approximately 6,600 probationary IRS employees will be retained to work through the tax filing season. Staff involved in customer service and taxpayer advocacy have been spared from the cuts for now. However, some senior IRS executives remain concerned about the agency’s ability to process returns efficiently and on time.
The layoffs will impact various roles, including revenue agents, auditors, and IT specialists across the country, with workers in New York, California, Georgia, and Tennessee among the hardest hit.
During an interview with Fox News host Jesse Watters, U.S. Commerce Secretary Howard Lutnick,
“So, he’s gonna cut a trillion [dollars] and then we’re gonna get rid of all these tax scams that hammer against America, and we’re gonna raise a trillion dollars of revenue, and our objective under Donald Trump is to balance this budget, and I’m telling you, you watch it, we’re gonna do it.”
When asked by Watters if the money that has been saved by the Department of Government Efficiency (DOGE) is going to go back to the American people, Lutnick said Trump’s goal is to abolish the IRS completely.
“Well, think about it, Donald Trump announced the external revenue service, and his goal is very simple … his goal is to abolish the Internal Revenue Service and let all the outsiders pay. I mean this is someone who is focused on America. Let’s drive down our waste, foreign abuse.”
Lutnick told Watters that some foreign imports and ships currently pay no tax.
“I’ll give you an example, cruise ships. You ever see a cruise ship with an American flag on the back? They have flags of like Liberia or Panama. None of them pay taxes. None of them pay taxes. Every super tanker, none pays taxes. Alcohol, all foreign alcohol — no taxes.”
Lutnick said ultimately tax rates for Americans are going to come down.
“This is going to end under Donald Trump, and those taxes are gonna be paid, and Americans tax rates are going to come down. That’s what Donald Trump wants to do. Balance our budget and cut our taxes. I mean imagine a Democratic senator going against that, what planet are these people on?”
