The IRS Service has issued layoff notices to 1,399 employees, deepening staffing losses at an agency already facing a significant workforce reduction.

According to a court filing this week in a union lawsuit against the federal government, the layoffs are part of a larger Treasury Department reduction that affects 1,446 employees overall.  

Journal of Accountancy reports that the IRS confirmed that most of the affected workers serve in key divisions. This includes 527 employees in exam and collections, which handles enforcement and compliance programs; 489 in information services, responsible maintaining and securing IRS technology systems; and 297 in shared services and support, which oversees policy management, finance, and communications.

Smaller reductions also affect Treasury-wide programs and the Community Development Financial Institutions Fund.  

A federal injunction previously restricted layoffs during the government shutdown, but the IRS said no employees protected under that order received notices.

The agency’s workforce had already fallen by about 25% earlier this year, with more than 25,000 employees departing through voluntary incentive programs, according to the Treasury Inspector General for Tax Administration.  

The IRS also updated its contingency plan for the ongoing shutdown, recalling some staff to support the implementation of the One Big Beautiful Bill Act, the sweeping tax reform law enacted earlier this year.