The IRS is weeks away from the start of a busier-than-usual filing season. But a group of senators is warning that the agency may be stretched too thin after losing more than a quarter of its employees.

Sen. Elizabeth Warren (D-Mass.), a member of the Senate Finance Committee, and Sen. Angus King (I-Maine) led 15 other senators in a Dec. 21 letter raising concerns about the start of the IRS filing season.

The letter, addressed to Treasury Secretary Scott Bessent — who is also serving as acting IRS commissioner — and IRS Chief of Taxpayer Services Ken Corbin, states the 2026 tax filing season “will present a huge test for the IRS.”

“We write with serious concerns that the Internal Revenue Service (IRS) is not prepared for the upcoming tax filing season and that American taxpayers may face delays and difficulties in filing their tax returns and receiving their tax refunds,” the senators wrote.

All senators on the list are Democrats, except for King and Sen. Bernie Sanders (I-Vt.) — both of whom caucus with Senate Democrats.

The IRS lost about 25% of its workforce last year through voluntary separations and retirements.

A recent report from the Treasury Inspector General for Tax Administration found these staffing cuts will make it more difficult for the IRS to detect fraud, process tax returns, and provide tax help over the phone and in-person at its Taxpayer Assistance Centers.

The TIGTA report also raises concerns that staffing cuts in the IRS’s IT department are delaying the agency’s ability to modernize its systems, including an initiative to digitize much of its paper-based workload.

“Taxpayers deserve to have the information and assistance they need to file their taxes and receive their refunds in a timely manner,” the senators wrote. “The Trump administration’s relentless attacks on the IRS threaten its ability to serve the public and undercut its mission to provide taxpayers with top-quality service and ensure that our tax laws are enforced with integrity and fairness.”

The IRS paused its IT modernization efforts in March. But internal documents show the agency is planning to modernize a more than 50-year-old IT system that’s critical to its work every filing season.

Internal documents obtained by Federal News Network show the agency is working on a “future state” of its Integrated Data Retrieval System (IDRS), a massive clearinghouse of taxpayer data.

IDRS allows IRS employees to review an individual’s tax information when they call asking for help, or send tax notices to individuals. The system also makes it possible for taxpayers to track the status of their federal tax return refund check.

The IRS expects that this modernization project, once complete, will make it much easier for employees to retrieve a taxpayer’s records when they contact the agency asking for help.

The internal documents show the IRS is working with several tech companies on this project, including Salesforce, Amazon Web Services and Palantir.

IRS employees were told last summer that layoffs were off the table. But during the recent government shutdown, the Treasury Department sent reduction-in-force notices to nearly 1,400 IRS employees.

Employees affected included those working in tax enforcement, IT and human resources. Those RIFs were rescinded, but layoff protections contained in a stopgap spending bill are set to expire on Jan. 30.

The agency lacks a permanent commissioner. Seven acting commissioners led the agency last year. Former congressman Billy Long, President Donald Trump’s first permanent pick to lead the agency, stepped down last August.

During his two-month tenure at the IRS, Long fell out of step with senior Treasury officials on several decisions. Those included rescinding RIFs within its Office of Civil Rights and Compliance, announcing that Direct File was “gone” months ahead of the agency’s official announcement, and stating the 2026 filing season would begin in mid-February, later than usual, to give the IRS workforce more time to prepare.

The IRS has not yet announced the start date of this year’s filing season. Federal News Network has reached out to the Treasury Department and the IRS for comment.

National Taxpayer Advocate Erin Collins, in her mid-year report to Congress last summer, said this year’s filing season was “largely successful.” But taxpayers may see delays during the 2026 filing season, given major staffing cuts.

This year’s filing season will be busier than usual. The IRS must update dozens of federal tax forms to reflect changes made under the One Big Beautiful Bill Act.

The IRS, as part of its fiscal 2026 budget request, said it needs to hire 11,000 call center representatives to “maintain” its current level of phone service. Without those hires, the agency warned it would only be able to answer about 16% of phone calls during next year’s filing season.

The IRS in July put out hiring notices to fill 4,500 full-time contact service representative jobs, but quickly pulled down those notices from USAJobs.

Months later, the IRS announced it would fill more than 2,150 frontline customer service positions. More than 70% of those job posts are for seasonal hires that can’t stay on the job for more than four years.

Term appointments generally don’t count toward career tenure, making it harder for employees to qualify for certain competitive service rights or transfer opportunities.

The Trump administration proposed giving the IRS more than $850 million to help the IRS hire those employees and roll out new automation tools to assist taxpayers.

But the House Appropriations Committee advanced its fiscal 2026 spending bill without these funds — and deeper overall IRS budget cuts than what the administration proposed.

The IRS recently moved about 1,000 IT employees out of its tech shop as part of a reorganization plan that’s been underway for months.

Impacted employees say they have few details about what work they’ll be doing, reportedly advised by the agency to instead “focus on completing an orderly transition of your current work.” The notice they received states that they will no longer be working on IRS IT projects.

According to the notice, obtained by Federal News Network, the reassignments went into effect on Dec. 28.

Employees who received the email have until Jan. 9 to complete an “orderly transition.” That includes wrapping up current work, offloading assignments and supporting project handoffs.

Employees in question have been told that their reassignment is “permanent realignment out of the CIO organization,” but the move to the Office of the Chief Operating Officer is temporary. The agency’s HR office is looking to reassign the employees to jobs across the IRS and Treasury.

Reassigned employees are being asked to upload their resumes no later than Jan. 23, 2026.

The IRS stayed open on Dec. 24 and Dec. 26, even though President Donald Trump gave most federal employees those days off. The agency sought volunteers to work those days, offering holiday pay to those who signed up.

The agency’s acting chief human capital officer told staff in a memo that keeping the IRS open would allow employees to “continue to work mission-critical efforts.”

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The Department of Veterans Affairs is embarking on major changes next year. It’s looking to get the rocky rollout of a new Electronic Health Record back on track. VA medical facilities already using the system have been beset with problems for years.

Meanwhile, the VA is planning to roll out the biggest reorganization of its health care operations in decades. Here’s a look ahead at VA’s plans for 2026.

VA EHR next steps

VA is planning for its new EHR from Oracle-Cerner to go live at 13 sites in 2026 — starting with four sites in Michigan in April 2026.

Dr. Neil Evans, acting program executive director of VA’s Electronic Health Record Modernization Integration Office, told the technology modernization subcommittee of the House VA Committee that, based on lessons learned from previous go-lives, multiple sites will go live “simultaneously in each deployment wave.”

“This approach allows us to scale up the number of deployments, enhance efficiencies and improve the sharing of best practices within and between markets,” Evans said in a Dec. 15 hearing.

Carol Harris, the director of IT and cybersecurity issues at the Government Accountability Office, told lawmakers it would be “very risky” for VA to plan for simultaneous EHR go-lives.

“It’s going to take a tremendous amount of resources that I’m not quite sure is sustainable for multiple sites at once,” Harris said.

Status of EHR rollout so far

VA’s new EHR is currently running at six sites. Full deployment would bring the EHR to 170 sites. According to Evans, the department currently expects to complete the deployment as soon as 2031.

The VA has been in a “reset” period since April 2023, and paused new go lives until the department addresses persistent outages and usability issues reported by VA medical staff at sites already using the new EHR.

A GAO report in March found that only 13% of VA staff using the new Oracle-Cerner EHR believed that the modernized system made VA as efficient as possible, and 58% of users believed the new system increased patient safety risks.

Rep. Tom Barrett (R-Mich.), chairman of the technology modernization subcommittee, said the project’s lifecycle cost has grown to about $37 billion.

“This timeline is locked in, and the countdown is on. But the question remains: When the switch is flipped in April, will the system deliver, and will it do what we need it to do? Are we going to run into snags like we have in the past? For millions of veterans relying on VA hospitals and staff supporting them, this is not something that is theoretical. It’s real. It’s happening and we have to do it right,” Barrett said.

Subcommittee ranking member Nikki Budzinski (D-Ill.) said what she has heard from VA and Oracle this year “has not convinced me that VA is ready for launch at 13 facilities in 2026.”

“I have raised many questions with VA and Oracle. But the answers do not give me confidence. In fact, I worry that we are spending billions of dollars while simultaneously setting this program, particularly the six sites that are already live, up for failure,” Budzinski said.

Reaction from the Senate

Senate Democrats are also wary about VA’s EHR rollout plans. In a letter to VA Secretary Doug Collins, Sens. Patty Murray (D-Wash.), Richard Blumenthal (D-Conn.) and Elissa Slotkin (D-Mich.) said they have “serious concerns” that EHR problems flagged by GAO and the VA inspector general’s office have not been fully addressed

“While we should always strive to innovate and improve the quality of care for veterans, in practice, the rollout of EHRM has been so problematic that it created life-threatening problems and ongoing upheaval for veterans’ ability to get the health care they need,” they wrote.

New VHA leader & VA reorganization plans

Last week, the Senate confirmed John Bartrum, a former senior advisor to Collins, will serve as VA’s under secretary for health.

Bartrum, a combat veteran with more than 40 years of active-duty and reserve military service, previously oversaw policy and funding at the National Institutes of Health and the Centers for Disease Control and Prevention.

The VA earlier this week announced its intent to reorganize the Veterans Health Administration.

Collins said in a statement that VHA’s current leadership structure “is riddled with redundancies that slow decision making, sow confusion and create competing priorities.”

VA says the changes aren’t expected to result in a significant change in overall staffing levels. But the Washington Post first reported that the VA no longer plans to fill tens of thousands of vacant health care positions.

The VA says it’s briefed lawmakers on the reorganization, and that implementation will take place over the next 18-24 months.

Rather than pursue a reduction in force of more than 80,000 employees, as it had considered earlier this year, the VA shed more than 30,000 positions through attrition in fiscal 2025.

“The department’s history shows that adding more employees to the system doesn’t automatically equal better results,” Collins told lawmakers in May.

The post VA in 2026 looks to get EHR rollout back on track, embark on health care reorganization first appeared on Federal News Network.

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