Tax Fraud Whistleblower Protection
The attorneys at The Employment Law
Group® law firm have experience
representing whistleblowers in
disclosing federal tax fraud or
underpayments.
IRS Whistleblower Reward Program
Under the IRS Whistleblower Reward
Program, an individual who exposes tax
fraud can receive an award ranging from
15% to 30% of the proceeds recovered by
the IRS. To qualify for an award, the
tax, penalties, interest, additions to
tax, and additional amounts in dispute
must exceed $2,000,000 and, if the
allegedly noncompliant person is an
individual, the individual's gross
income must exceed $200,000.
After the IRS completes an
investigation, the Whistleblower Office
will issue a final determination
regarding the whistleblower's award
amount. If the whistleblower feels that
the award does not adequately reflect
his or her whistleblower contributions,
the whistleblower may appeal the IRS's
decision to the Tax Court within 30
days.
What protection is available for the
Tax Fraud Whistleblower?
The IRS will maintain the
confidentiality of the whistleblower's
identity throughout the initial
investigation process. If however, the
whistleblower's testimony is needed in a
judicial proceeding to further the IRS'
investigation, the whistleblower's
identity may be revealed.
What types of Activities are
Considered Tax Fraud?
Examples of tax fraud or evasion
include:
1. Deliberately underreporting or
omitting income;
2. Claiming false deductions;
3. Hiding or transferring assets or
income;
4. Overstating the amount of deductions;
5. Making false entries in records;
6. Failing to report income earned in a
stock exchange;
7. Maintaining two sets of books;
8. Misusing trusts; and
9. Abusing charitable deductions.
Timeframe for Filing an IRS
Whistleblower Disclosure
The statute of limitations for making a
disclosure under the IRS Whistleblower
Reward Program is three years from the
time the tax return was filed, but if
the disclosure concerns an omission in
excess of 25% of the gross income stated
in a tax return filed with the IRS, the
statute of limitations extends to six
years. The statute of limitations does
not apply where a false or fraudulent
tax return was filed with the intent to
commit tax evasion.
Duration of IRS Investigations
IRS investigations can take years to
complete but a detailed disclosure can
shorten the process. Payment of awards
will not be made until there is a final
determination of the tax liability that
is owed to the IRS and the owed funds
are collected by the IRS.
What Types of Disclosures Will Result
in a Whistleblower Reward?
A disclosure is more likely to result in
an award if it includes documentation of
fraudulent transactions, a solid paper
trail, and detailed evidence
demonstrating tax fraud. Disclosures
that are speculative or lack concrete
evidence of tax underpayment may not
result in a whistleblower award. Where
two whistleblowers disclose the same
fraud, the whistleblower who made the
original disclosures will receive the
award.
If you have information about tax fraud
or tax underpayment, contact The
Employment Law Group® law firm at
888-603-0983 or by email at
inquiry@employmentlawgroup.com
The Employment Law Group® law firm
has written about the IRS Whistleblower Rewards Program for
the following publications:
Disclaimer: This website
is maintained by The Employment Law Group® law firm to provide general
information about itself and the field of employment law. The information you
obtain at this site is not, nor is it intended to be, legal advice upon which
you should rely or act. If you would like to discuss your potential claim call
us at 888-603-0983 or
inquiry@employmentlawgroup.com
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