The IRS Whistleblower program is designed to ferret out fraud and underpayment in excess of $2 million per taxpayer liability.
If the IRS uses information provided by a whistleblower, the whistleblower can receive an award of 10 to 30 percent of the total amount collected.
The IRS whistleblower law went into effect for whistleblower claims filed after December 20, 2006, and this law is a major step in an ongoing effort to root out big-dollar tax evasion.
IRS whistleblower awards in successful cases are mandatory, and the award percentage ranges are statutory, with a general range of between 15 and 30 percent, with some exceptions.
There is no limit on the dollar amount of the award. A reduced award of up to 10 percent may be made in cases where the information provided to the IRS is principally based on information derived from:
a judicial or administrative hearings;
a governmental report, hearing, audit or investigation;
the news media, or;
- if the whistleblower “planned and initiated” the tax fraud scheme.
IRS whistleblower awards are subject to appeal to the U.S. Tax Court.
Unlike the False Claims Act, there is no private right of action in a declined IRS whistleblower case.