IRS Office Redeployment 10-15-25

Major IRS office changes, including office closures, employee reductions, and a return-to-office mandate, are underway in 2025 due to new administrative policies and a federal government shutdown. These redeployments are expected to significantly affect both employees and taxpayer services nationwide.  

Office consolidation and closures

Taxpayer Assistance Centers (TACs): In September 2025, the IRS announced plans to close nine TACs by November 30, 2025, as part of a cost-reduction strategy.

Broader closures: Earlier in 2025, the U.S. General Services Administration (GSA) had already informed the IRS that it would terminate or not renew the leases for more than 110 offices.

Consolidation of services: The Department of the Treasury is consolidating administrative functions across its bureaus, including the IRS, to centralize support services like IT, HR, and procurement. 

Employee workforce reduction

Mass layoffs: Following the return of a Trump administration in January 2025, the IRS implemented mass layoffs, reducing its workforce by approximately 25% by May 2025.

Furloughs during shutdown: The ongoing government shutdown, which began in October 2025, has resulted in the furloughing of nearly half of the remaining IRS workforce.

Department-specific cuts: Certain divisions have been particularly affected by the workforce reduction:

Large Business and International Division: ~74% staff reduction

Small Business/Self-Employed Division: ~67% staff reduction

Tax-Exempt and Government Entities Division: ~84% staff reduction 

Return-to-office mandate

Implementation: Effective March 9, 2025, the IRS initiated a return-to-office policy, requiring most remote employees to report to an official duty station.

Relocation for some employees: The policy requires employees who work remotely and live more than 50 miles from an IRS location to be reassigned to an official office.

Office space issues: The agency has acknowledged that some facilities may not have enough space to accommodate all employees, leading to temporary, non-standard workspace arrangements for some staff. 

Potential impact on services

Disruption and delays: The government shutdown and staffing cuts are expected to cause delays in taxpayer assistance, refunds, and audit resolutions.

Reduced taxpayer support: The reduction in staff is having a significant impact on in-person services, including the Taxpayer Advocate Service, which assists taxpayers with financial hardships.

Uncertainty for taxpayers: The ongoing changes have created uncertainty for both taxpayers and tax professionals, with increased wait times and processing delays likely. 

IRS "redeployment" efforts in 2025 have focused on workforce reductions, office consolidations, and a revised IT modernization plan, influenced by budget cuts and the current government shutdown. The term "redeployment" is more applicable to internal restructuring and administrative centralization rather than large-scale office relocations. 

Workforce and office changes

·       Furloughs: An ongoing government shutdown, which began in October 2025, has caused the IRS to furlough nearly half its workforce, closing most operations to the public.

·       Office consolidations: The Treasury Department is centralizing administrative functions from multiple bureaus, including the IRS, into a new division called the Treasury Common Services Center. This effort will consolidate IT, human resources, procurement, and other support roles.

·       Taxpayer Assistance Center (TAC) closures: The IRS announced plans to close nine TACs in September 2025, reversing a previous effort to expand in-person services.

·       Return-to-office mandate: In March 2025, the IRS set a deadline for some remote employees to return to physical duty stations, acknowledging that some facilities might face space constraints. 

Technology modernization

·       IT overhaul: In March 2025, the IRS paused its IT modernization programs and subsequently created a new plan focused on nine initiatives, down from 23. The revamped plan is meant to align with the current administration's goals for a "leaner, more focused" IT organization.

·       Legacy system issues: Despite progress on modernizing case management, the agency has yet to decommission many of its older, or "legacy," IT systems. This results in ongoing maintenance costs and complications. 

Budget and leadership

·       Budget cuts: Nearly half of the $80 billion in supplemental funding provided to the IRS by the 2022 Inflation Reduction Act has been rescinded by Congress. This has been a major driver behind staffing and program cuts.

·       Leadership changes: As the IRS navigates budget and operational changes, the Treasury Department appointed Frank Bisignano as Chief Executive Officer in October 2025 to oversee daily operations. 

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Norb Leahy, Dunwoody GA Tea Party Leader