IRS to Furlough Nearly Half Its Workforce Amid 2025 Government Shutdown
- Viktoriya Barsukova, EA, MBA

- Oct 9
- 3 min read

As of today, October 8, 2025, the Internal Revenue Service has begun implementing its Lapsed Appropriations Contingency Plan, released by the U.S. Treasury, in response to the ongoing federal government shutdown. According to the plan, only 39,870 IRS employees—approximately 53.6% of its total workforce—will remain on duty, with the remainder placed on furlough.
The plan, initially effective for five business days, is designed to sustain essential operations using funds not dependent on annual appropriations. However, the Treasury has indicated that the plan will be adjusted as necessary should the shutdown extend further into the fiscal year.
IRS Operations Continuing During the Shutdown
Despite the reduced workforce, the IRS has confirmed that several critical functions will continue in order to protect taxpayer data, maintain core systems, and preserve legal obligations. Ongoing activities include:
Completion and testing of upcoming filing year programs.
Implementation of the “One Big Beautiful Bill Act” (OBBBA, P.L. 119-21).
Processing of returns with payments and other remittances.
Handling of disaster relief transcripts and limited mail processing related to payments.
Maintenance of essential computer operations to prevent data loss or system degradation.
Protection of statute expiration, bankruptcy, liens, and seizure cases.
Design and printing of tax forms for the 2026 filing season.
Continuing Income Verification Express Service (IVES) and Revenue and Income Verification Service (RAIVS) photocopy programs, specifically where necessary for mortgage and financial institutions.
Additionally, the IRS will continue coordination with other federal agencies, including the Social Security Administration (SSA) and Office of Personnel Management (OPM), and will continue issuing certificates of U.S. residency to prevent disruptions in international tax compliance.
Functions Suspended During the Shutdown
In contrast, a broad range of taxpayer-facing and compliance activities have been suspended. These include:
Issuing refunds and processing of most amended or paper returns that do not include payments.
Non-disaster transcript processing and income verification services outside of the IVES and RAIVS exceptions.
All audit and examination functions.
Non-automated collections and enforcement activities unrelated to imminent legal deadlines.
Legal counsel services not tied to excepted operations.
Taxpayer assistance services, including most call centers, except for limited FEMA-routed calls.
Planning, training, and development activities not required for essential operations.
Closure of all Taxpayer Advocate Service (TAS) offices nationwide, halting casework and taxpayer assistance.
The Taxpayer Advocate Service confirmed via its website that all offices are closed and that no staff are available to assist taxpayers during the shutdown period.
Extended Plan Through April 2026
The IRS also released an updated contingency plan anticipating a potential prolonged lapse in appropriations through April 2026. This update clarifies that furloughed employees will be recalled within hours once funding resumes, following a structured communication plan distributed through the IRS’s Employee Emergency News webpage.
According to the updated plan, operations that protect life, property, or taxpayer data will continue under “excepted” or “exempt” status. This includes employees whose roles are legally authorized, funded by multi-year appropriations, or essential to safeguard critical systems.
Implications for Taxpayers
2025 Government Shutdown
While electronic filing systems remain operational and payments will still be processed, taxpayers should expect significant delays in refunds, amended returns, and all correspondence requiring human review. Those awaiting responses from the IRS, including pending audits or notices, will likely experience extended response times until normal operations resume.
Tax professionals are advised to monitor updates closely through official IRS communications and the IRS Employee Emergency News portal for any modifications to the contingency plan, particularly if the shutdown continues or if new federal disaster declarations trigger expanded IRS support for FEMA.
San Diego Precision Tax Service will continue to monitor developments and provide updates as additional information becomes available from the U.S. Treasury and IRS leadership.
2025 Government Shutdown




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