As part of its initiative to catch taxpayers who are paying fewer taxes than they actually owe to the U.S. government, Congress has enacted the IRS Whistleblower Rewards Program. The Whistleblower Rewards Program provides substantial incentives to individuals who come forward and identify other persons, businesses and corporations, trusts, partnerships, and other entities that are underpaying their taxes in any way, whether it is the result of fraud, uncertain tax positions, or just simple mistake.
The incentive is a mandatory award to the person or whistleblower who comes forward to reveal the underpayment of taxes to the IRS. This award can equal up to 30 percent of any taxes, interest, and penalties collected by the IRS from the underpaying taxpayer. The IRS Whistleblower Protection was enacted by the Tax Relief and Health Care Act of 2006. It does not place a cap on the dollar amount of the award, so those who come forward and identify a large underpayment of taxes by another taxpayer stand to potentially collect millions of dollars in award monies from the government for their efforts.
Tax Whistleblower Reward Amounts
In Section 7623 of the Internal Revenue Code, whistleblowers are allowed an award of between 15 and 30 percent of the taxes ultimately collected by the IRS if they make a substantial contribution to the collection. The award will be calculated based on the total of the tax, interest, penalties, and any additions to tax collected by the IRS as a result of the information provided by the whistleblower. Rewards can also issue for whistleblowers who report information about an underpayment that would reduce the amount of the refund claimed by the taxpayer. The award is not capped.
The Whistleblower Rewards Act is targeted at unveiling large underpayments of taxes. A person will only receive an award under the program if the total underpayment of the tax, along with interest, penalties, and additions to tax, ultimately collected by the IRS exceeds $2 million. The income of the individual taxpayer who owes taxes must exceed $200,000 in the year the tax was due. Whistleblowers should be aware in attempting to make calculations as to underpayment, penalties range from 20-40 percent of the tax due. Compounding interest combined with penalties will often result in the doubling of the total amount of deficiency taxes that would otherwise have been paid if submitted in a timely manner.
Anyone who has participated in the Whistleblower Rewards Program and received no award or an award they feel was less than they deserve can appeal the determination to the United States Tax Court. Your licensed whistleblower attorney will guide you through the entire process of reporting tax fraud to the ultimate award of the monies you deserve.
Barrett Law PLLC: Assisting You in Blowing the Whistle on Tax Fraud
Under the IRS Whistleblower Rewards Program, you could receive an award of up to 30 percent of all taxes, interest, and penalties collected by the IRS as a result of your crucial information. Tax fraud costs the U.S. government billions of dollars each year, and it takes brave whistleblowers like you to put a stop to this illegal activity. The seasoned Mississippi Whistleblower Attorneys at Barrett Law PLLC have over 75 years experience assisting individuals in a wide variety of whistleblower actions. Our attorneys will assist you in the art of dealing with the IRS so that you collect the award you deserve for reporting tax fraud. At Barrett Law PLLC, we offer a free consultation to all new clients and operate on a contingency fee basis. For representation of simply unmatched excellence, call Barrett Law PLLC today at 1 (601) 790-1505 to schedule your free consultation.
