IRS Layoffs Threaten Tax Refund Delays and Federal Revenue Loss

Staffing cuts of 7,000 employees during tax season risk slowing refunds, weakening enforcement, and increasing the federal deficit.

The IRS has laid off approximately 7,000 employees, with most cuts affecting enforcement and collections, reducing the agency's ability to pursue high-wealth tax evaders.
Experts warn that the layoffs, coupled with a hiring freeze, could delay tax refunds, especially for those filing closer to the April 15 deadline or with errors in their returns.
Tax professionals strongly advise filing electronically and as early as possible to avoid delays and ensure timely refunds, particularly for low-income families relying on tax credits.
Customer service is expected to suffer, with longer phone wait times and fewer resources available to address taxpayer concerns during the busy filing period.
A Congressional Budget Office report highlights that reduced IRS funding could significantly lower federal revenue, potentially increasing the deficit by tens of billions of dollars over the next decade.