According to a recent report, the FBI and IRS are rolling out a collaborative effort to investigate nonprofit organizations believed to have connections to domestic terrorism. The program stems from a December 2025 memorandum issued by Attorney General Pam Bondi instructing federal law enforcement to focus on probes and criminal cases involving groups and individuals associated with the antifa movement.  Attorney General Bondi’s directive also urged agents to examine possible tax crimes in which purported “extremist” organizations may be defrauding the Internal Revenue Service.

A spokesperson for IRS Criminal Investigation (“IRS CI”) confirmed that IRS CI agents will operate in tandem with the FBI at a newly established operations hub, drawing on IRS CI’s deep proficiency in financial probes to bolster enforcement efforts. IRS CI agents will rotate through one-year stints at the FBI-housed facility. IRS CI agents will rotate through one-year stints at the FBI-housed facility.

Despite the reductions-in-force and early retirements, it appears that IRS-CI is moving forward with the current administration’s plans to investigate nonprofit organizations for purported ties to domestic terrorism. 

It remains to be seen whether IRS CI and the FBI will conduct traditional criminal tax investigations which normally take months or years.  It is also unclear whether the IRS CI will follow its own procedures in auditing nonprofit organizations.  But those organizations should prepare for increased IRS CI scrutiny, as losing tax-exempt status may result in significant tax consequences.