Justice Dept. budget cuts will eliminate special tax unit

June 22, 2025

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Justice Department façade photo by JSquish/Wikimedia Commons

It’s not a particularly good time to be a federal employee looking to ensure tax compliance.

Already this year, the Internal Revenue Service has lost almost a third of its tax auditors thanks to Department of Government Efficiency, or DOGE, cuts.

Now the Department of Justice’s (DoJ) special tax crimes unit is being eliminated.

The DoJ personnel moves, however, aren’t as drastic as the IRS staff reductions. The jobs won’t be lost, just reallocated to other areas in the Justice Department.

Tax division absorbed into other units: The end of the DoJ’s Tax unit is noted in the department’s Budget and Performance Summary.

The June 13 document also details the Justice Department’s overall budget request of $33.6 billion for the coming fiscal year, Oct. 1, 2025, through Sept. 30, 2026.

That's a 7 percent cut from the DoJ's FY 2025 operating funds. From the personnel perspective, the department’s total head count will be almost 5,100 less.

Part of the fiscal reduction comes from zeroing out the current $106.4 million allocated to the DoJ Tax Division.

The report notes that the Tax unit's mission "is to enforce the nation's tax laws fully, fairly, and consistently, through both criminal and civil litigation, to promote voluntary compliance with the tax laws, maintain public confidence in the integrity of the tax system, an promote the sound development of the tax laws."

That now will be accomplished, according to the report, by staff in the DoJ's Civil and Criminal divisions, into which the Tax area's 503 employees will be reassigned as part of the Department's reorganization.

Tax closure’s dollar shifts and savings: Because the Tax division’s responsibilities will still be around, the actual dollar savings won’t be the full $106.4 million — which also is this weekend’s By the Numbers figure — that will come off the books from that line item for fiscal 2026.

To accommodate the realignment of Tax responsibilities scheduled for this August, the DOJ is requesting 0.7 percent more in funding for the Criminal division. The request ups the $225.3 million DoJ got for fiscal 2025 to $226.8 million to help it to enforce federal criminal laws, including tax violations, in the 2026 fiscal year.

The Civil division budget request is larger. DoJ is seeking $434.3 million for the division in fiscal 2026, a 12.1 percent increase over the $387.8 million it got in 2025 for its activities, which now will include tax matters.

So while the increased fiscal 2026 requests for the DoJ’s Civil ($46.5 million more) and Criminal ($1.5 million more) divisions comes to a combined increase of $48 million, the loss of the $106.4 million Tax division line item means savings of $58.4 million.

Both divisions also will operate with fewer staff in fiscal 2026.

And that consolidation of Tax personnel into the Civil division later this summer will streamline operations and produce efficiencies, according to the DoJ report. The Tax Agency Reduction-in-Force (RIF) and Reorganization Plan (ARRP) will save $22.1 million and reduce staff by 107 positions, 67 of whom are attorneys.

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