IRS Layoffs Could Impact Your Tax Return

Getting your taxes done in a timely manner may be a thing of the past thanks to thousands of layoffs at the IRS.

Over 3,500 employees in the IRS’s Small Business/Self-Employed (SB/SE) division have lost their jobs this week. An email sent to IRS managers on Wednesday (2/26/25) broke the news. Reports from the Associated Press, citing anonymous sources, say the total number of IRS terminations may be much higher.

The SB/SE division services more than 57 million small business owners and self-employed individuals, with around 41 million self-employed taxpayers making up the bulk of that number.

Leaders at the American Institute of CPAs (AICPA) shared concerns about the cuts, urging the IRS to consider the needs of taxpayers and tax preparers as part of President Trump’s directive to reduce the federal workforce.

AICPA President Mark Koziel said in a statement, “Americans deserve a fully functioning agency that can be respected by taxpayers and their preparers, allowing them to comply with their tax obligations.”

While the full impact of these changes is still uncertain, Koziel noted, “The AICPA is actively monitoring the situation and working with IRS leadership to understand and minimize the effects on IRS services.”

In a LinkedIn post, Melanie Lauridsen, AICPA’s vice president of Tax Policy & Advocacy, emphasized that “the IRS must have the ability to meet the needs of taxpayers and their preparers” and urged the administration to keep adequate support in place.

Tax Day is April 15th.