Not even the mighty IRS can avoid the latest political hot potato, sequestration (mandatory across-the-board spending cuts for nearly all federal agencies).

Yesterday the Senate rejected two bills that would have avoided the sequestration. This means it is almost guaranteed that the automatic spending cuts required by the Budget Control Act of 2011, P.L. 112-25 will kick-in.

The Internal Revenue Service (IRS) told employees on Thursday that agency furloughs from sequestration would not begin until after tax-filing season, according to a union that represents agency workers.

With mandatory government spending cuts looming, Acting IRS Commissioner Steven Miller sent a memo to all IRS employees on Thursday, outlining the agency’s plans in the event sequestration occurs as planned on Friday. He outlined spending cuts the IRS plans to make, including employee furloughs, but emphasized that the furloughs would not affect tax season.

The IRS’s largest expense is employee pay, and the agency plans to furlough employees, starting in the summer, if the mandatory across-the-board spending cuts take effect. Miller anticipates five to seven furlough days per employee through the end of the government’s fiscal year. The furloughs would apply to all IRS employees and would amount to no more than one furlough day per pay period.

Miller listed three other ways in which the IRS will cut spending:

Continue a hiring freeze;
Reduce funding for grants and other expenditures; and
Cut costs for travel, training, facilities, and supplies.

So as you read all the press, hear the talking heads and experts and worry about the apparently dysfunctional budget process remember that the IRS is in the mess right along with all of us.

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