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The IRS entered the 2026 filing season with roughly 74,000 employees, down from 102,000 at the start of 2025. That 27% workforce reduction is already affecting how the agency handles everything from phone calls to collections cases.
If you’re currently dealing with an IRS problem, whether it’s an unpaid balance, an audit, or a pending installment agreement, this staffing crisis directly impacts how long your case will take to resolve.
Here’s what changed, what it means for you, and what you can do about it.
What Happened to the IRS Workforce?
Throughout 2025, the IRS lost approximately 28,000 employees through voluntary separations, early retirement offers, and reductions initiated under the Department of Government Efficiency. According to the National Taxpayer Advocate’s 2025 Annual Report to Congress, the hardest-hit areas are the offices taxpayers rely on most during disputes, audits, and resolution cases.
Staffing losses by key IRS division:
| IRS Division | Workforce Reduction |
| Taxpayer Services (phones, mail, processing) | ~22% |
| Information Technology | ~27% |
| Small Business / Self-Employed | ~38% |
| Independent Office of Appeals | ~29% |
| Taxpayer Advocate Service | Significant cuts reported |
National Taxpayer Advocate Erin Collins put it plainly: many departing employees were experienced workers whose knowledge cannot easily be replaced.
How This Affects Taxpayers With Existing IRS Problems?
If your tax situation is straightforward, you e-filed an accurate return with direct deposit, you’ll likely get your refund within the usual 21 days. The staffing crisis won’t be noticeable.
But if you have an active case with the IRS, the impact is real and measurable.
Phone service has been scaled back
The IRS lowered its phone service target from 85% to 70% for the 2026 filing season. In practice, that means roughly 3 out of every 10 callers won’t reach a live person. Wait times are longer, and the agency is reassigning employees from departments like HR and IT staff with no direct tax experience to answer phones during peak season.
If you’ve ever spent hours on hold trying to discuss a payment plan or respond to a notice, expect that to get worse this year.
Paper return and correspondence backlogs have surged
The Treasury Inspector General for Tax Administration (TIGTA) reported that the backlog of paper returns waiting to be processed jumped from 52,293 in December 2024 to 294,052 in December 2025, a nearly sixfold increase in just one year.
This backlog doesn’t just affect people who file on paper. It slows down amended returns, taxpayer correspondence, and responses to IRS notices. If you mailed in documentation for a collection case or an offer in compromise, your paperwork is sitting in a much longer queue than it was a year ago.
Identity theft cases now take nearly two years
Victims of tax-related identity theft are waiting an average of 22 months to get their cases resolved. The Taxpayer Advocate has repeatedly called these delays “unconscionable,” noting that many affected taxpayers are low-income filers who depend on their refunds for basic living expenses.
Appeals cases face longer wait times
The Independent Office of Appeals the division responsible for reviewing disputed IRS decisions, lost approximately 29% of its staff. If you’ve requested a Collection Due Process (CDP) hearing or are disputing an audit finding, your case may sit in the queue significantly longer than in prior years.
What This Means If You Owe Back Taxes?
Here’s where the staffing crisis creates a paradox that many taxpayers don’t anticipate.
The IRS is slower to help you but not slower to enforce.
While customer service and case resolution are hampered by reduced staffing, automated enforcement systems continue at full capacity. In January 2026, the IRS expanded its use of AI-driven collection scoring models that prioritize enforcement actions like bank levies and wage garnishments.
This means the window between receiving a notice and facing enforced collection has effectively compressed. You may have less time to respond, fewer opportunities to reach someone by phone, and a longer wait once you do engage.
For taxpayers in active collections, this creates a specific set of risks:
- Installment agreements may take longer to process, leaving you exposed to penalties and interest in the interim.
- Offer in Compromise applications require extensive documentation review and with fewer staff, processing times are extending well beyond the typical 6-12 months.
- Currently Not Collectible (CNC) status requests require financial hardship verification that now takes longer to complete.
- Audit reconsiderations and penalty abatement requests are sitting in larger correspondence backlogs.
If you’re dealing with any of these situations, the worst thing you can do is wait. The IRS’s automated systems don’t pause because their human staff is overwhelmed.
Why Professional Representation Matters More in 2026?
In a normal year, a motivated taxpayer can sometimes navigate IRS issues on their own, making calls, submitting forms, and following up on timelines. In 2026, that self-service approach is significantly harder.
When you work with a CPA experienced in tax resolution, you gain several practical advantages during this staffing crisis.
Priority communication channels. Tax professionals with an active Power of Attorney (Form 2848) have access to the Practitioner Priority Service line, which typically has shorter hold times than the general taxpayer line.
Proper documentation the first time. With the IRS unable to process correspondence quickly, errors or incomplete submissions can set your case back by months. An experienced CPA ensures every filing, response, and supporting document is complete and accurate before it enters the queue.
Strategic timing. Certain resolution options, like an Offer in Compromise or a CDP hearing request have strict deadlines. Missing a 30-day window because you couldn’t reach the IRS by phone is not something the agency will forgive.
Protection from escalation. If you have a Revenue Officer assigned to your case, professional representation signals cooperation and can prevent unnecessary enforcement actions while your case is being worked.
I’ve spent over 25 years representing clients before the IRS from individuals with modest back taxes to Fortune 50 corporations. The common thread in every successful resolution is early, informed action.
What You Should Do Right Now?
If you have an unresolved IRS issue an unpaid balance, unfiled returns, a pending notice, or an active audit take these steps today:
Don’t ignore IRS notices. Deadlines remain firm even when the agency’s response times are slow. A CP504 (Intent to Levy) still gives you only 30 days to act.
File all outstanding returns. The IRS views unfiled returns as a compliance red flag that can accelerate enforcement. Even if you can’t pay what you owe, filing shows good faith.
Consider professional help before enforcement begins. Resolving a tax issue before a levy or garnishment is issued is dramatically easier and less expensive than trying to undo one after the fact.
Use digital tools when possible. The IRS Online Account, Direct Pay, and the AI Tax Chat on my website can help you get preliminary answers and take action without waiting on hold.
The Bottom Line
The 2026 IRS staffing crisis is not a temporary inconvenience. For anyone with an active tax problem, the margin for error has shrunk considerably.
Don’t try to navigate IRS collections alone during a staffing crisis. If you’re facing a tax issue that needs resolution, call me directly at (786) 265-8578 for a confidential case review. The sooner we act, the more options you’ll have.
Ed Parsons is a licensed CPA with over 25 years of experience in tax resolution, compliance, and advisory services. He represents individuals and businesses nationwide from offices in Miami and Boston.