IRS Whistleblower Program
How To File An IRS Whistleblower Claim
Protection From Employer Retaliation
Over the past year, the Internal Revenue Service (IRS) made 179 award payments to individual citizens who blew the whistle on tax fraud. These awards totaled $36,144,926. The awards paid to whistleblowers generally range between 15 to 30 percent of the proceeds collected and attributable to their information. Section 7623 of the Internal Revenue Code outlines the framework for whistleblower awards:
(a) In General
The Secretary, under regulations prescribed by the Secretary, is authorized to pay such sums as he deems necessary for—
(1) detecting underpayments of tax, or
(2) detecting and bringing to trial and punishment persons guilty of violating the internal revenue laws or conniving at the same,
in cases where such expenses are not otherwise provided for by law. Any amount payable under the preceding sentence shall be paid from the proceeds of amounts collected by reason of the information provided, and any amount so collected shall be available for such payments.
(b) Awards to Whistleblowers
(1) In General
If the Secretary proceeds with any administrative or judicial action described in subsection (a) based on information brought to the Secretary’s attention by an individual, such individual shall, subject to paragraph (2), receive as an award at least 15 percent but not more than 30 percent of the proceeds collected as a result of the action (including any related actions) or from any settlement in response to such action (determined without regard to whether such proceeds are available to the Secretary). The determination of the amount of such award by the Whistleblower Office shall depend upon the extent to which the individual substantially contributed to such action.
Section 7623(b) incorporates various other rules and criteria with respect to whistleblower claims, such as requiring that the information: (1) relate to a tax noncompliance matter in which the tax, penalties, interest, additions to tax, and additional proceeds in dispute exceed $2,000,000; and (2) relate to a taxpayer, and for individual taxpayers only, one whose gross income exceeds $200,000 for at least one of the tax years in question.
If you have credible information of tax fraud in San Francisco or elsewhere in California, call us today at (415)441-8669. Our toll-free number is 1-888-50EVANS (888-503-8267).
Filing a Whistleblower Claim
Individual taxpayers may submit a whistleblower claim to the IRS if they are eligible. The following individuals are ineligible to file a claim:
- An individual who is an employee of the Department of Treasury;
- An individual who obtained the information through the individual’s official duties as an employee of the Federal Government;
- An individual who is or was required by Federal law or regulation to disclose the information or is precluded by Federal law from disclosing the information; or
- An individual who filed a claim for award based on information obtained from an ineligible whistleblower.
If an individual is eligible, he/she may submit Form 211 along with supporting documentation to the IRS Whistleblower Office. IRS whistleblower claims should provide: (a) sufficient, relevant information and supporting documentation; (b) timely information for the IRS to properly act; and (3) information based on firsthand knowledge and/or reliable, documented sources.
Protections Against Retaliation
The IRS prohibits retaliation against whistleblowers. Potential retaliatory actions include an employer’s decision to “discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment.” A tax whistleblower who suffers such retaliation must file their complaint with the Occupational Safety and Health Administration (OSHA) no later than 180 days after the violation occurred. If the Secretary of Labor has not issued a final decision within 180 days of the filing of the complaint, and there is no showing that such delay is due to the bad faith of the claimant, then the employee may file suit in federal court. If successful before OSHA or the court, the employee is entitled to all relief necessary to make them whole, including reinstatement with the same seniority status that they would have had, but for the reprisal; 200% of the amount of back pay, with interest; 100% of all lost benefits, with interest; and any special damages sustained as a result of the reprisal, including litigation costs, expert witness fees, and attorney fees.
Ingrid M. Evans represents individuals in San Francisco and throughout California with credible, original information of any kind of tax fraud, including offshore tax avoidance measures, and use of foreign corporations and accounts to avoid taxation or the like. Ingrid can be reached at (415) 441-8669, or by email at <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>. Our toll-free number is 1-888-50EVANS (888-503-8267). Ingrid can also represent individuals who have been retaliated against for blowing the whistle on tax fraud.