IRS backtracks on layoff plans

The Internal Revenue Service is reportedly reversing course on some of its wide-ranging job cuts after realizing they reduced the staff too drastically. 

The IRS sent a memo permitting employees to rescind their applications for its Deferred Resignation Program and Treasury Deferred Resignation Program, which offered incentives for voluntary buyouts to employees.

“IRS has identified areas where staffing reductions created a potential gap in mission-critical expertise,” said an email Wednesday from acting IRS human capital officer David Traynor and acting deputy IRS chief human capital officer David Allen, , according to the Federal News Network and Government Executive. “As a result, IRS will utilize all available tools — including details, reassignments, DRP/TDRP recissions, external hiring — to identify resources to fulfill the mission-critical skill sets.”

The IRS has lost over 25% of the approximately 100,000 employees it had in January, due to layoffs, voluntary buyouts under the IRS’s deferred resignation programs and early retirement as of May, according to a report released in July by the Treasury Inspector General for Tax Administration. 

According to IRS records, 25,386 employees have separated, taken a voluntary buyout offer under one of the deferred resignation programs, or used some other incentive to leave. Another 294 employees were sent termination notices due to reduction in force actions. The separations hit particularly hard at employees in enforcement positions, with approximately 27% of tax examiners now separated, and 26% of revenue agents separated. 

The IRS lost about 26% of its workforce this year between the start of the filing season and June, according to a different report from National Taxpayer Advocate Erin Collins. The staffing cuts and voluntary buyouts under two Deferred Resignation Programs were especially heavy among revenue agents, according to an earlier TIGTA report.

Another report released earlier this week by TIGTA found the IRS didn’t follow its own internal procedures when terminating thousands of probationary employees nor consider their individual performance. The IRS now plans to bring back 400 revenue agents and 300 revenue officers who accepted the deferred resignation offer. The IRS did not immediately respond to a request for comment.

The IRS’s Human Capital Office is reportedly no longer accepting volunteers for the Deferred Resignation Programs and plans to provide managers with additional information and guidance on how to bring back an employee who has an approved DRP/TDRP rescission agreement.