IRS Staffing Constraints Impact NY Taxpayers
Confirmed IRS staffing constraints in 2025 — including a federal hiring freeze and documented workforce reductions — are reshaping federal tax administration. Official reports show reduced employee counts and uneven IRS phone wait times, developments that could affect how New York taxpayers access assistance.
A presidential memorandum issued January 20, 2025, ordered a freeze on hiring federal civilian employees and specified that the freeze would remain in place for the Internal Revenue Service until the Secretary of the Treasury determines lifting it is in the national interest. The directive limits the agency’s ability to refill vacancies under normal timelines.
The White House memorandum states that executive departments and agencies must pause hiring, with the IRS subject to continued restrictions pending further determination. That means open roles may not be filled at the pace typical before the order. For taxpayers, staffing levels influence how quickly calls are answered, correspondence is processed, and account issues are reviewed.
According to the memorandum, the policy is intended to manage federal workforce levels across agencies. The IRS, as part of the Treasury Department, remains covered under that instruction.
The Treasury Inspector General for Tax Administration (TIGTA) reported that between January and May 2025, IRS employee counts declined from approximately 103,000 to about 77,000 — a reduction of roughly 25 percent. The report notes that the decrease affected “each function within the IRS.”
TIGTA’s Management and Performance Challenges Facing the IRS for Fiscal Year 2026 outlines operational pressures tied to staffing levels. The report also explains that despite the hiring freeze beginning in January 2025, the IRS received an exception to hire customer service employees for the 2026 filing season and planned to use Direct Hire Authority to fill those roles.
The reduction spans divisions responsible for taxpayer services, enforcement, and operations support. Workforce changes can influence how quickly amended returns are reviewed, notices are resolved, and identity verification cases are processed.
Separate TIGTA findings highlight variability in IRS telephone service. During the 2024 filing season, the IRS reported an 88 percent level of service and average wait times of about three minutes. However, TIGTA found those figures were based on a subset of phone lines and did not reflect the whole taxpayer experience.
The audit states that some non-main lines averaged 17 to 19 minutes in wait time during the filing season. TIGTA also documented that Level of Service rates fluctuated throughout the year, reaching as low as 48 percent in June 2024.
The report concluded that publicly reported metrics “do not fully reflect the taxpayer experience.” For individuals who must call specialized lines — such as those handling payment plans or compliance matters — wait times can differ significantly depending on timing and call category.
At the state level, the New York State Department of Taxation and Finance confirms that when a taxpayer reports identity theft, the department may place an indicator on the account and manually review returns for up to three years. The department notes that this process “may cause a delay in the processing of your returns.”
Identity theft cases often involve both federal and state filings. When returns require manual handling, processing timelines can extend beyond automated review cycles. For New York taxpayers managing federal and state issues simultaneously, coordination between agencies may involve additional documentation and verification steps.
IRS staffing constraints, workforce reductions, and variability in phone service are documented in official federal oversight reports. Tax matters that require human review — including notice responses, amended returns, payment arrangements, and identity verification — depend on the availability of personnel.
Phone access also varies by line and month, according to TIGTA’s audit. Taxpayers seeking assistance may consider checking official online tools before calling and responding promptly to written notices to avoid extended correspondence cycles.
While no specific outcomes are predicted in the reports, confirmed staffing levels and service data illustrate operational conditions facing the agency in 2025. For New York taxpayers, those conditions intersect with state-level identity theft safeguards that can require manual review.
By William Mc Lee, Editor-in-Chief & Tax Expert—Get Tax Relief Now
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