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Over 6,000 employees at the Internal Revenue Service (IRS) are expected to be laid off by the end of the week, according to a source familiar with the agency's plans.

More than half of these terminations—over 3,500—are coming from the Small Business/Self-Employed (SBSE) Division, as indicated in an internal email obtained by CBS News.

The email, sent to SBSE managers on Wednesday, stated that affected employees would be informed on Thursday by the IRS Human Capital Office.

SBSE Commissioner Lia Colbert and Deputy Commissioner Maha Williams wrote, "While details are still developing, we understand that over 3,500 SB/SE probationary hires will be terminated by the end of this week."

These layoffs come just weeks before the tax filing season hits its busiest period, from mid-March through mid-April. According to the email, the affected employees were considered "not critical to filing season."

IRS managers were instructed to notify employees about their terminations by noon on Thursday.

Those let go would receive full pay for the day and be placed on administrative leave for the remainder. Since federal probationary employees typically serve a one- to two-year trial period, those with less than a year at the IRS will not qualify for severance pay.

Managers were also directed to ensure that terminated employees returned their government-issued equipment. If employees could not report in person, IT personnel would coordinate the return of laptops, ID badges, and other items.

Federal Employee Unions Sue Over Mass IRS Terminations

The IRS terminations are part of a broader effort initiated by the Trump administration to reduce federal staffing.

An executive order issued in early February directed agencies to cut probationary employees. This aligns with previous workforce reduction plans that have targeted newer government hires across multiple federal agencies.

In an effort to soften the impact, affected IRS employees received a list of national tax organizations where they could seek new job opportunities. However, the sudden terminations have drawn criticism, especially as tax season ramps up.

Before the layoffs, the IRS employed approximately 100,000 people, a notable increase from the 80,000 employed at the start of President Joe Biden's term, EconomicTimes said.

The agency had expanded hiring under the Inflation Reduction Act, which allocated $80 billion in additional funding to the IRS.

However, part of that funding—$1.4 billion—was rescinded in a congressional bill passed in 2023.

The mass layoffs also affect IRS employees across all 50 states, with significant cuts in Pennsylvania, New York, Utah, California, and Kentucky.

The terminations include revenue agents, customer service representatives, tax dispute specialists, and IT staff.

Labor unions representing federal employees have filed lawsuits challenging the legality of these terminations.

Meanwhile, White House officials have defended the decision, stating that the government needs to prioritize efficiency and budget reductions. "We want to ensure that employees we retain are productive and effective," White House economic adviser Kevin Hassett said.

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