The mass firings of IRS employees are putting at risk the agency’s ability to issue timely refunds and answer taxpayer questions – along with threatening to reverse recent upgrades to some of the agency’s antiquated technology – former IRS managers said on March 11.
“Getting those refunds out … is very important,” said Kelly Reyes, executive director of the Professional Managers Association (PMA), a membership association for IRS managers. Staffing upheaval at the agency accentuated by the Trump administration’s push to return workers to the office, she said, is “disrupting that critical process of ensuring that we get those refunds out.”
“We believe that we’re going to see some challenges, some great challenges, in that area as we move through the next couple of months,” she said at a PMA-organized media briefing.
More broadly, Reyes added, the chaos is imperiling technology upgrades and customer service improvements made possible by an infusion of funds for the agency under the 2022 Inflation Reduction Act (IRA).
“Customer service has improved greatly over the past couple of years,” she said. “There were lots of improvements in the technology department and a lot of growth and things planned … A lot of that is just going to waste right now.”
The administration last month began firing nearly 7,000 employees at the IRS amid tax filing season, with the reductions focused on probationary employees who had worked for the government for less than two years. About 5,000 of the fired employees were a part of the agency’s compliance teams, which focus on auditing and collections.
The mass staff cuts, part of government-wide firings and employee resignations spearheaded by Elon Musk’s Department of Government Efficiency (DOGE), have alarmed Democrats and tax experts, who have warned of major impacts on the current tax filing season.
Administration officials have said that President Trump wants to abolish the IRS and replace it with an “External Revenue Service” funded by tariff revenue.
The recent staffing reductions follow the Biden Administration’s efforts to beef up enforcement and modernize the IRS’s notoriously antiquated legacy technology systems.
Under the IRA, Congress provided the IRS with about $79 billion in additional funding over a 10-year period to help with modernization efforts.
Among other improvements, the cyber chief of the IRS’s law enforcement arm said in November 2024 that artificial intelligence (AI) was transforming how his team tackles cybercrime, digital forensics, and fraud.
But Congress rescinded $20 billion of the IRA funding in 2023 and repealed another $20 billion when it approved the latest continuing resolution funding bill in December of last year.
The effects of the staffing cuts will be felt throughout the regular tax filing season but especially into the fall as the reductions take hold amid filing extensions that lead to taxpayer questions, the former IRS managers said.
“Unless your return comes in, it’s accepted as filed, and you’re done with it for the next year, anybody else is going to have real difficulties after May getting ahold of somebody at the IRS,” said Donald Dick, a retired IRS analyst and manager. “That’s going to be an issue,” he said.