IRS Terminated Probationary Employees Without Following Internal Procedures and Considering Individual Performance

Our evaluation focused on the actions and processes that the IRS followed when it sent
termination notices in February and March 2025 to probationary employees.

The IRS identified more than 16,000 employees who were still in their probationary period. After
exempting employees who were either deemed essential personnel for tax filing season, had appeal
rights, were involved in law enforcement, or were military spouses, the IRS issued termination letters to
7,315 probationary employees. The time between identifying employees and issuing termination notices
was 29 days. All probationary employees received the same letter that cited performance as a reason for
termination. We confirmed that nearly all the terminated probationary employees either did not have a
performance rating on record or were rated as Fully Successful or better. We determined that 51 percent
had no performance rating of record. For the remaining 49 percent, we determined that
3,251 (90 percent) had a “Fully Successful” rating, and 305 (8 percent) had an “Outstanding” or “Exceeded Fully Successful” rating. As a result, we conclude that the IRS did not consider individual employee
performance when terminating probationary employees.

Prior to the termination notices being sent, senior IRS officials refused to sign the notices and raised
concerns that many of these employees did not have documented performance issues. Despite these
concerns, the IRS’s Human Capital Office sent the notices. However, the IRS did not correctly identify all
mission critical services and employees when it identified probationary employees who were exempt from
termination. After sending out termination notices, the IRS later attempted to rehire a small number of
employees who had incorrectly been identified for termination.

In July 2025, the U.S. Supreme Court stayed the federal court’s prohibition on covered agencies
implementing Agency Reduction in Force and Reorganization Plans and issuing or executing reduction in
force (RIF) notices. At the time we published this report, it is unclear whether any probationary employees
will remain reinstated or be terminated in a future large-scale RIF.