After mass layoffs, IRS to plug holes with AI

The Internal Revenue Service (IRS) has plans to take advantage of the "AI boom" to fill glaring workforce gaps, following the layoff of thousands of tax agents. In a May 6 oversight hearing of the House Appropriations Committee, U.S. Treasury Secretary Scott Bessent explained that the agency would be leaning into AI solutions in order to accommodate further reductions in the IRS' budget and staff and not fall behind on tax collection. The Treasury's budget proposal includes the removal of another 40,000 jobs. According to Bessent, proposed cuts to the agency's IT budget could be an opportunity to modernize and restructure the agency's existing IT infrastructure, as the current administration hones in on "wasteful" spending. "I believe, through smarter IT, through this AI boom, that we can use that to enhance collections. And I would expect that collections would continue to be very robust, as they were this year," he said.