IRS Whistleblower Program

Under the IRS Whistleblower Program, those who report underpayments or violations may receive an award for blowing the whistle.

In 2006, the Tax Relief and Health Care Act of 2006 was enacted to enhance the existing IRS Whistleblower Program. It provided for payment of an award to eligible whistleblowers for information regarding tax under payments or violations of the internal revenue laws that lead to proceeds collected that qualify for an award. The award was no longer discretionary. Rather, the new law says that the whistleblower shall receive 15 to 30 percent of the collected proceeds. The new law also established a Whistleblower Office and added appeal rights for whistleblowers.

 

To qualify for an award, the information proffered must relate to a noncompliance matter in which the amount in dispute (ie. tax, penalties, interest, additions to tax) exceeds $2 million.

Tax fraud, tax evasion and other violations of tax law can take many different forms, including:

  • Understating income

  • Transfer pricing

  • Abusive tax shelters

  • Unreported or underreported offshore income

  • Cryptocurrency tax fraud

  • Abuse of tax-exempt status

  • Employment tax fraud