IRS Whistleblower Program
The Internal Revenue Service Whistleblower Office was created in 2006 as a result of the “Tax Relief and Health Care Act.” The IRS Whistleblower Program provides eligible tax whistleblowers a portion (15% to 30%) of collected proceeds, which includes interest and penalties, when an investigation is initiated based on information provided by the claimant.
In order to receive an award under Internal Revenue Code Section 7623(b) through the IRS Whistleblower Program, claimants must bring forward specific and credible information showing a taxpayer individual or entity has failed to meet their tax obligation to the U.S. government. The evidence provided must lead to the recovery of a minimum of $2 million.
The IRS Whistleblower Office, which keeps tax whistleblowers anonymous throughout the submission process, examines the evidence provided and will determine whether or not to pursue the allegations of noncompliance.
Specific examples of tax fraud can include:
- Offshore Tax Havens: a company knowingly moves money to a bank in another country to avoid reporting taxable income;
- Shell Accounts: setting up multiple bank accounts and circulating money across these accounts to propagate tax benefits;
- Money Laundering: the activity of masking or concealing the source of illegally-obtained money by transferring to foreign banks or legitimate businesses;
- False Reporting: reporting incorrect information on tax returns, such as underreporting revenues or taxable income;
- Falsely Operating Under Tax-Exempt Status: claiming a tax-exempt status to receive tax credits or deductions;
- Pyramiding: withholding employee taxes and intentionally not remitting taxes to the IRS, then filing bankruptcy and starting another company;
- False Payroll Tax Returns: preparing false payroll tax returns understating the number of wages on taxes owed;
- Failure to Pay Payroll Taxes: failing to file employment tax returns are methods commonly used to evade employment taxes.
TWAG helps tax whistleblowers put together quality Form 211 submissions for the IRS Whistleblower Office that will catch the agency’s attention and put the claimant’s provided evidence in the best light possible.
TWAG attorneys also help to protect the whistleblower’s identity and fight for the maximum reward possible for the evidence provided, whether through the IRS Whistleblower Program or at the U.S. Tax Court.