IRS Drafting Plans to Slash 90,000-Person Workforce in Half

The Internal Revenue Service is drawing up plans to slash its 90,000-person workforce in half, according to a report.

The tax-collecting agency aims to achieve the massive reduction in its workforce through layoffs, attrition and buyout offers, sources told the Associated Press on Tuesday.

The Trump administration also plans to reallocate some IRS employees to the Department of Homeland Security, where they will assist with immigration enforcement – a request DHS Secretary Kristi Noem made to Treasury Secretary Scott Bessent last month.

The layoffs are part of DOGE-led efforts by the Trump administration to quickly shrink the size of government by shuttering federal agencies, firing probationary workers with less than one year on the job and incentivizing federal employees to leave their posts through a “deferred resignation program.”

The IRS already laid off about 7,000 probationary employees in February.

A White House memo directed all federal agencies late last month to develop plans by March 13 to reduce staffing.

It is unclear if the White House would approve the IRS’ plan to cut half its workforce, and over what period of time the massive cuts would be implemented.

DOGE chief Elon Musk has embedded two staffers at the IRS headquarters in Washington in recent weeks who have pushed to access agency databases, including one that contains information about IRS contractors, according to the New York Times.

Commerce Secretary Howard Lutnick revealed last month that one of President Trump’s objectives over the next four years is to have US revenues from tariffs become so great that the IRS would no longer be needed.

“His goal is to abolish the Internal Revenue Service and let all the outsiders pay,” Lutnick said during an appearance on Fox News Channel’s “Jesse Watters Primetime.”

Trump, 78, announced ahead of his inauguration that he plans to create an external revenue office tasked with collecting all foreign-sourced revenue, such as income from tariffs.

“For far too long, we have relied on taxing our Great People using the Internal Revenue Service (IRS),” the president wrote in a Jan. 14 Truth Social post. “Through soft and pathetically weak Trade agreements, the American Economy has delivered growth and prosperity to the World, while taxing ourselves.”

On the campaign trail, Trump repeatedly boasted that his tariff plan would bring the American economy back to a “golden age,” noting that before 1913 — when the 16th Amendment gave Congress the power to levy federal income tax — the government was primarily funded from tariffs.

Trump implemented sweeping 25% tariffs on Mexico and Canada Tuesday and doubled a 10% tariff on China to 20% as part of an effort to get the three nations to crack down on fentanyl being illegally exported to the US.