Nearly half of RIF’d IRS probationary staffers had ‘fully successful’ or better reviews, watchdog finds

As the Trump administration ordered agencies in February to terminate probationary employees, several senior IRS officials sounded the alarm to the Treasury Department’s watchdog, making the case that those tax agency staffers had no performance issues.

Those concerns proved to be well-founded: According to a new report from the Treasury Inspector General for Tax Administration, 51% of the 7,315 IRS probationary employees who were sent termination notices had no performance rating of record, while the remaining 49% had ratings of “fully successful” or better.

“As a result, we conclude that the IRS did not consider individual employee performance when terminating probationary employees,” TIGTA wrote, despite the fact that all of those probationary employees “received the same letter that cited performance as a reason for termination.” 

In May, leadership at the IRS and Treasury decided to reverse course and return all probationary staffers to full work status, TIGTA noted, though the Supreme Court OK’d the administration’s plans to move forward with agency reductions-in-force in July. It remains to be seen whether the IRS workers who were called back are vulnerable to future reductions in force.

Among the tax agency employees that were able to avoid RIFs during the winter were those in some business units deemed essential for the upcoming filing season. The information technology department was one of those units with employee exemptions, according to TIGTA, though nearly 50 IT executives were cut by DOGE in March.  

A TIGTA snapshot report published last month found that the IRS’s business IT division had lost a quarter of its staffers since the beginning of the Trump administration through May, leaving the unit with just over 2,100 employees. According to the report, the IT management job series across all IRS units was down 23%.

Newly departed IRS executives warned FedScoop in April that workforce reductions could undercut modernization and the use of artificial intelligence, and former Commissioner Charles Rettig said the agency didn’t have the technology to “backfill the gaps” created by cuts.

Those concerns come in the aftermath of notable progress at the IRS on modernization efforts prior to the Trump administration. In a separate TIGTA report released last week, the watchdog detailed Inflation Reduction Act-funded advancements at the tax agency in 2024, including “modernizing tax account processing, promoting agility across operations, implementing new technology solutions, empowering business growth, strengthening network communications, reinforcing enterprise security, and enhancing operations.”

According to the report, the IRS last year completed projects involving the expansion of network bandwidth, the implementation of a strategic management system tool, and enhancing data-at-rest encryption, among others. The agency still has work to do on multifactor authentication and enterprise data platform projects, TIGTA said.

“The foundational technology advancements enable the IRS to continue to improve the taxpayer experience and protect the integrity of the nation’s tax system,” the watchdog concluded.