Trump’s Proposed 2025 IRS Overhaul: 3 Key Takeaways

The current Trump administration is proposing significant overhauls to the IRS. These changes include budget cuts, technology advancements, and even tax policy changes. But what will these changes mean for you as a taxpayer?

On July 3, 2025, the House Republicans voted to approve the “one big beautiful” tax bill act. This bill seems to make Trump’s 2017 tax cuts permanent.

Tax Attorneys of America will break down three important takeaways so you can stay informed and protect your financial future.

1: Budget Cuts and Workforce Reduction in the IRS

The Trump administration is planning on downsizing the IRS in the coming years and intends to shift resources away from operations, support, and enforcement. 

Concerns have been raised on the taxpayers' behalf about whether these changes will negatively impact customer service. 

What to Expect:

• Reduction in middle-management IRS jobs
• Potential impact on live IRS agents and customer service representatives

What does this mean for taxpayers? Faster response times could be possible, but there may be less access to live IRS representatives

2: Technology Advancements and the Impact of AI

Trump’s plan for the IRS involves shifting resources into AI-driven automation and self-service online tools.

These advancements in technology include the automation of scanning documents, extracting data, and streamlining the refund and collection process. 

Highlights:

• Expansion of AI and automated systems:
  • Chatbots
  • Online digital tools
• Automated task to improve IRS operations and efficiency

At Tax Attorneys of America, we have live agents waiting to assist with your tax debt concerns and help navigate uncertain tax conditions.

3:  New Emphasis on Taxpayer Bill of Rights

Finally, there are proposed tax policy changes aimed at reshaping the tax policy. This includes extending the elements of the 2017 Tax Cuts and Jobs Act (TCJA).

These changes include lower tax brackets, expanding the child tax credit, eliminating taxes on tips and overtime, and making higher standard deductions permanent.

Proposed Enhancements:

• Extending the TCJA past the end of 2025
  • ‘SALT’ deduction
  • Child tax credit
  • ‘Trump’ accounts for children
  • Fewer federal student benefits, loan limits
  • Cuts to Medicaid funding 
  • Lower Car loan interest
  • Reduced food stamp benefits
  • Senior ‘bonus’ deduction
• Increased tax breaks and lower taxes for many households

What Does the Future of the IRS Look Like Under Trump?

At this stage, the IRS overhaul is only a proposal. However, with the Republican House members' approval of the “one big beautiful” bull act, sweeping changes to the IRS seem imminent. 

Whether you’re a self-employed business owner or individual taxpayer, it’s vital to stay informed about how tax policy changes could affect your:

• Filing process
• Deductions and credits
• Audit risks
• Rights as a taxpayer

At Tax Attorneys of America, we’re here to help you prepare your tax filing for whatever reforms may come. If you have questions about how this proposal may affect you, contact us today for expert legal and tax advice.