Internal Revenue Service Commissioner Danny Werfel announced on Monday, marking his one-year anniversary in the IRS’ top position, that the tax agency is planning to expand its workforce to over 100,000 employees within the next three years. This expansion is deemed necessary to achieve the agency’s objectives related to modernization, service enhancement, and enforcement. However, Werfel emphasized that additional funding would be required to sustain this increased capacity.
Werfel outlined that the immediate focus of hiring efforts will be on enhancing taxpayer services and managing complex audit processes. The IRS is set to unveil its hiring strategies in the coming month as part of an update to its strategic operating plan. This plan is fueled by approximately $60 billion in supplemental funding allocated over a decade from the 2022 Inflation Reduction Act.
“At present, we have around 90,000 employees. However, to achieve our desired operational efficiency over the next two to three years, we anticipate surpassing the 100,000 mark,” Werfel stated.
This proposed workforce expansion represents a significant increase of over 20,000 full-time equivalent staff compared to the fiscal 2022 level of 79,070. Notably, IRS employment had dwindled to 73,519 in 2019 following years of budget cuts, particularly under Republican-controlled Congresses.
Contrary to Republican claims of the IRS building an “army” of 87,000 agents, Werfel clarified that the overall staffing increase would be much less dramatic. This figure was derived from a 2021 Treasury report projecting hiring needs to address retirements and rebuild the workforce.
Despite President Joe Biden’s proposed budget for fiscal 2025 requesting an additional $104 billion in IRS funding, negotiations in Congress have resulted in a reduction of the original $80 billion in funds to $60 billion. Werfel assured that the IRS would maintain its pace of near-term investments in technology despite the funding cut.
As discussions continue in Congress amidst the looming threat of a partial government shutdown, Werfel cautioned about potential disruptions for taxpayers in receiving refunds during the ongoing tax filing season. He underscored the agency’s commitment to operate within legal constraints but acknowledged limitations in maintaining full operational capacity.
Looking ahead, Werfel emphasized the necessity of additional funding to support the IRS’s expanded workforce and sustain efforts in conducting sophisticated audits and upgrading technology. Failure to secure adequate funds could lead to a reduction in capacity, he warned.
