IRS halts layoff plans, looks to rehire some fired employees 

The Internal Revenue Service (IRS) is halting its layoff plan and aims to restaff the agency. 

"As the IRS works to modernize and implement President Trump’s agenda, including the One Big Beautiful Bill, we are committed to ensuring the agency is staffed appropriately to serve the American people effectively and efficiently,” a Treasury spokesperson said in a statement to The Hill. 

This represents a reversal from months of cutting by the IRS, which has been in turmoil for months and recently lost its commissioner, Billy Long.

Since February, the IRS has tried to downsize its workforce from 100,000 employees to 60,000.

It fired 6,700 employees on Feb. 20, especially in teams working on tax compliance. In March, the IRS intended to cut staff from the National Taxpayer Association (NTA), which reports to Congress about IRS services. In April, it eliminated the Office of Compliance and Civil Rights as the Department of Government Efficiency recommended overall cuts of up to 20 percent.

In February, Kevin Hassett, chair of the White House Council of Economic Advisers, said the administration believed too many people were employed by the government to collect taxes.

"I think our objective is to make sure that the employees that we pay are being productive and effective. And there are, many, more than 100,000 people working to collect taxes. And not all of them are fully occupied,” he said in remarks at the White House at the time.

There had been previous signals of a reversal by the IRS.

On Aug. 1, Long in a memo to those still working at the civil rights office said that the agency was reversing its decision to close it. The memo was obtained by Federal News Network.

Additionally, there have been worries that laying off IRS staff might create problems for tax filing season. In 2024, less than one-third of calls to the IRS were answered.

In July, congressional Democrats also sent a letter to the IRS showing that their constituents were receiving “bounce-back” emails with no answers, according to Government Executive. 

The cuts to the IRS have been part of a broader effort by the Trump administration to cut federal workers, though the IRS has also received greater attention because of investments the Biden administration sought to make in the tax-collecting agency.

The Trump administration has, since February, cut around 150,000 government employees, arguing it would make the government more efficient. By the end of 2025, projections show the federal workforce will be reduced by 300,000 workers due to layoff plans and buyouts.