The Form 211 is the required IRS application for submitting relevant information regarding tax noncompliance and requesting an award based on the information provided.
Tax whistleblowers must take the time to file a Form 211 that immediately grabs the attention of the Internal Revenue Service Whistleblower Office. The agency receives thousands of Form 211s each year, and nearly half are rejected. Ultimately, only a handful of Form 211 submissions make it to the finish line in the form of an award. Thus, the challenge becomes submitting a Form 211 that leads the IRS to action and results in collected proceeds for the government.
A successful Form 211 will provide the IRS with a brief, clear narrative and avoid detours. Here are some “Dos and Don’ts” to consider when submitting a Form 211 to the IRS Whistleblower Office.
The Dos
The IRS Whistleblower Office has been clear about what it wants to see in Form 211 submissions:
Be specific.
- Include the taxpayers name, address (EIN & SSN if available).
- If the taxpayer is a major company, include the specific division or subsidiary at issue.
- Include the tax issue. The IRS shouldn’t have to guess or piece together the tax issue.
Be credible.
- Provide credible information based on your own knowledge and awareness.
- The IRS prefers that you have first-hand knowledge of the taxpayer and the tax issues. Insider information is even better.
- Provide documents that support your position; be able to point the IRS to the key documents.
- It is helpful if you have a background in the tax issue.
Be current.
- The IRS is interested in matters where the tax years are still open (in general, the last six tax years unless fraud can be proven), unless involving failure to file or undeclared offshore accounts.
- Information should be about recent and ongoing tax evasion.
The IRS is also interested in hearing about emerging issues, something that is new to them, such as a tax scam along with taxpayer(s) that have not been on their radar. In addition, the IRS will be interested in information about wealthy individuals evading tax.
The Don’ts
Don’t speculate.
- The IRS is not interested in theories or deep thoughts on general issues of concern.
- The IRS understands that a whistleblower may not have every piece of the puzzle, but they do expect substance in the submission.
Don’t hold back.
- If you have documents that are critical to your case, provide them up front.
The Outlook
- The IRS Whistleblower Office has stated that it takes approximately six months for a whistleblower claim to be processed and assigned a claim number (thanks to continuing delays caused by COVID-19; mailing issues, etc.).
- Tax whistleblower claims are not paid out until proceeds have been collected (the taxpayer has paid and all rights to appeal have ended), which can take seven plus years, as detailed in the IRS Whistleblower Office annual report.
- The IRS has recently announced that it will provide more details on denial letters. While a denial is not the news a whistleblower wants to hear, it will provide a window as to whether the Form 211 made it past the first hurdles.
While patience is required, the IRS Whistleblower Office is welcoming of whistleblowers coming forward and is not reluctant to provide big awards.
