The Internal Revenue Service, having met the Biden administration’s requirement to bring federal employees back to the office more often, is extending its remote work pilot program.

The IRS planned to end its remote work pilot on June 15, but is now extending the program through Jan. 25, 2025.

Recent data from the Treasury Department found job postings advertising remote work yielded the most hires, and that retention and engagement scores have remained stable.

Chief Human Capital Officer Traci DiMartini, in an email to IRS senior executives this week, said the extension will give the agency additional time to collect and analyze data to evaluate the impact of remote work and to guide future decisions.

The IRS won’t add additional employees to the remote work pilot during this extension. Employees already enrolled in the remote work pilot don’t have to do anything to continue participating.

Current pilot participants, however, have the option to withdraw from the pilot at any time, after contacting their managers.

“We hope to finish this project strong and share decisions timely as we understand the importance of how it will impact employees and the agency,” DiMartini wrote. “We urge leaders to continue following the Remote Work Project requirements and ensure employees understand the extension is not a sign of any future remote work decision, which will be evaluated later.”

DiMartini, speaking Wednesday at a virtual event hosted by AGA (formerly the Association of Government Accountants), said the extended pilot will allow the IRS to make “evidence-based” decisions about its telework and remote work policies.

“We do know we have directives from the Office of Management and Budget and from the White House. But we also need to do our due diligence to make sure that we are collecting the data and telling the story in a quantitative way, that we can get our stakeholders — whether they be on the Hill, or whether they be down on 17th Street in the New Executive Office Building — they need to understand that these decisions are being made because we’re capitulating to the workforce, if this is the direction the workforce is going. And we really need to keep up, because I don’t want to lose people,” DiMartini said.

The IRS is tapping into billions of dollars it received in the Inflation Reduction Act to rebuild its workforce, after more than a decade of budget cuts.

The IRS grew its workforce to about 90,000 full-time employees — up from its 79,000-employee headcount in 2022.

By 2029, the IRS plans on adding another 14,000 full-time employees. That would bring its workforce up to 102,500 total employees.

“This is the first time I’ve worked for an agency that has resources, and also has a mandate from our commissioner,  to really go forward and thoughtfully upskill, reskill and repopulate our workforce ranks and pay a lot of attention to employee engagement and morale,” DiMartini said.

About 60% of the current IRS workforce, she added, is eligible to retire, and that younger generations in the workforce — particularly Generation Z and Generation Alpha — aren’t interested in staying anywhere more than three to five years.

“They want to go where they feel valued, and they’re putting a premium on work-life balance. So we are making sure that we are putting policies in place that really talk about what we want to be as an employer of choice,” DiMartini said.

NTEU President Doreen Greenwald told reporters at the union’s legislative conference in February that the IRS is seeing an uptick in people applying for jobs that allow telework or remote work.

“People like IT professionals, that they need desperately to move the government into this generation of technology, one of the things that brings in there is that flexibility,” Greenwald said. “We also know there is a skilled workforce out there, like single moms and things that rely on telework to be able to apply for these jobs and work. You don’t want to leave that diverse workforce on the sideline, not able to compete for these jobs because those flexibilities aren’t there.”

DiMartini said the IRS needs to rethink its recruiting pitch, in part, to attract in-demand tech workers.

“If someone works for Google or Microsoft, and never wants to come and work for the government, no matter how much money I throw at them, it’s not going to happen. In fact, I’m just going to probably get someone that’s going to upset the rhythms of an office. So, give me people that want to serve and then, whether they serve for a year or five years, or make a career of it, they’re going to be the workforce that really puts their all in,” she said.

Treasury’s own telework assessment it provided to Congress last summer “found no evidence that telework created a negative impact on retention, recruitment, or organizational performance.”

The report also found that since the pandemic, job announcements highlighting work flexibilities, such as telework, attracted the largest volume of applications.

Meanwhile, the IRS expects its employees to return to the office for half of all their workdays, starting on May 5.

The return-to-office plans only impact IRS executives, managers and non-bargaining unit employees with telework agreements in the National Capital Region. The decision affects IRS headquarters, the agency’s New Carrollton Federal Building and other offices in the Washington, D.C. area.

IRS Commissioner Danny Werfel told members of the House Ways and Means Committee in February that the agency’s workforce has, for the most part, already met a 50% in-office goal set governmentwide by the Office of Management and Budget.

“Overall, the IRS is roughly in line with the governmentwide standard of 50%,” Werfel told lawmakers.

Werfel told employees in an email that the IRS and Treasury are focusing their return-to-office plans on the greater Washington metro area, because the city is home to the IRS headquarters, a high concentration of IRS leadership, as well as “senior professionals that play a central role in policy decisions.”

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