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IRS furloughs nearly half its workforce, shuttering most operations

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The IRS said it was furloughing nearly half of its workforce and shuttering most operations Wednesday, but will continue work to implement President Donald Trump’s signature tax cuts.

Work on preparing for next year’s tax-filing season will also continue, but numerous operations will be halted, including taxpayer services like call site operations.

The agency will also suspend non-automated tax collections and “most headquarters and administrative functions not related to the safety of life and protection of property” during non-filing season, according to the agency’s latest contingency plan.

The plan will idle tens of thousands of employees. While 39,870 — 53.6 percent of the total workforce — will remain at work, 34,429 will be furloughed.

The union that represents IRS workers condemned the move.

“Today, due to the government shutdown the American people lost access to many vital services provided by the IRS,” said Doreen Greenwald, the national president of the National Treasury Employees Union. “Expect increased wait times, backlogs and delays implementing tax law changes as the shutdown continues. Taxpayers around the country will now have a much harder time getting the assistance they need, just as they get ready to file their extension returns due next week.”

When the government shut down last week, the agency exempted all of its employees from furlough for at least five business days, saying it would stay open by using special funding it was given by Congress in 2020.

But Wednesday morning, the agency announced that, “An IRS-wide furlough began on October 8, 2025, for everyone except already-identified excepted and exempt employees,” according to a statement on the IRS’s website. “Employee[s] who are not exempt or excepted are furloughed and placed in a non-pay and non-duty status until further notice.”

The IRS’s furlough decision letter — which came a day after a White House memo suggested furloughed federal employees might not receive backpay — includes a reminder that “employees must be compensated on the earliest date possible after the lapse ends, regardless of scheduled pay dates,” per a law Trump passed in 2019.

The Treasury Department did not immediately respond to a request for comment.

The agency originally dodged the furloughs in part because it bore responsibility for implementing the administration’s marquee tax cuts, including no tax on tips, overtime and Social Security, which Republicans are counting on for a boost in next year’s midterm elections.

“We suspect people will be getting notified all day,” said Daniel Scharpenburg, a union leader at the IRS.

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Congress

John Thune says he’s aiming to land DHS deal Thursday

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Senate Majority Leader John Thune said he wants to clinch a bipartisan Department of Homeland Security funding agreement Thursday.

“I think the Dems are now in possession of what I think is our last and final” offer, Thune told reporters. “So let’s hope this gets it done.”

“We’re going to know soon,” he added.

The South Dakota Republican declined to discuss details of the offer but suggested it was similar to where the discussions were headed over the weekend. GOP senators then were looking at a bipartisan deal that would fund most of DHS but leave out funding for ICE’s Enforcement and Removal Operations.

That offer was rejected by Democrats. But two people granted anonymity to discuss the revised proposal said it, too, omitted only ERO money but included additional language to try to address some of Democrats’ concerns.

Spokespeople for Senate Minority Leader Chuck Schumer did not immediately respond to a request for comment.

The Senate is expected to vote again on the House-passed DHS bill Thursday afternoon. The House is also voting again on DHS funding Thursday and is planning to leave town Friday morning for a two-week holiday recess. Progress in the Senate could prompt House GOP leaders to stay in session in hopes of sending a bill to President Donald Trump.

Asked about the Senate vote, Thune said he hoped there would be “some finality in this real soon.”

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Collins meets the Problem Solvers

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Senate Appropriations Chair Susan Collins joined the House Problem Solvers Caucus lunch Thursday to talk about the stalled Homeland Security funding effort and proposals to overhaul federal immigration enforcement activities.

“I think everyone is pretty frustrated at this point,” the Maine Republican said in an interview after the bipartisan meeting.

The centrist group, which extended the invitation to Collins, talked through the pain points on finding a path out of the DHS shutdown that has stretched more than 40 days and is triggering massive air travel disruptions. The conversation comes ahead of a House vote later Thursday on funding DHS, where moderates are looking to break the impasse.

Meredith Lee Hill, Jordain Carney and Riley Rogerson contributed to this report.

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Brian Fitzpatrick delivers a warning on GOP reconciliation redo

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As House Republicans start to dream big about another party-line bill, one key member who voted down the last GOP reconciliation bill is warning his colleagues not to count on his support.

Rep. Brian Fitzpatrick (R-Pa.) referenced his vote last summer against the “big, beautiful bill” in an interview Thursday and suggested he was prepared to oppose another GOP-only bill if it, too, includes spending cuts he opposes to social programs.

“You saw what I did on the first reconciliation bill,” Fitzpatrick said. Fitzpatrick and just one more House Republican could be enough to tank a party-line package given Speaker Mike Johnson’s slim majority.

Still, many of Fitzpatrick’s colleagues are making plans for an expansive new GOP-only bill that would include more money for Homeland Security operations, Iran war funding and other cost-of-living priorities, while demanding it be fully offset with spending cuts — possibly from social programs targeted for “fraud prevention.”

“You never say ‘never’ at anything, but I’m never a fan of single-party bills,” Fitzpatrick said. “That’s just my approach to government.”

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