Helping Whistleblowers Do the Right ThingTM
Each year, over $300 billion in taxes are under-reported to the Internal Revenue Service (IRS).
The IRS Whistleblower Office pays tax fraud whistleblowers up to 30% of what the IRS collects in unpaid taxes.
When you report tax fraud, you want to make sure the IRS takes action.
There is no limit to the reward you can recover. For example, if you report a $10 million underpayment of taxes, your reward could be up to $3 million.
The IRS has very specific rules you must follow. Here are three you need to know about.
- Tax Amount: In order to qualify for a reward, you must provide information on tax fraud or tax underpayments that total $2 million or more in combined taxes, penalties, and interest.
- Annual Income: In cases of individuals (as opposed to businesses), the individual taxpayer's gross annual income must exceed $200,000 during the year the tax was due.
- Reward Amount: The reward ranges between 15-30% of the amount the IRS collects and depends on the quality of proof that you present to the IRS.
If you are thinking about being a tax fraud whistleblower, you should immediately speak with a skilled IRS whistleblower attorney. Our IRS whistleblower attorneys provide counsel to IRS whistleblowers across the United States.
Do I Have a Good IRS Tax Whistleblower Case?
The first thing our IRS whistleblower lawyers do is determine if you have a good case.
Good IRS whistleblower cases generally involve whistleblowers who have insider knowledge and extensive documentation to support their claims.
When you report tax fraud, you want to make sure the IRS takes action.
To help you do this, we work with the best experts to support your whistleblower case.
We retain forensic accountants to analyze, interpret, and summarize complex financial misconduct. We work with former IRS revenue agents who specialize in accounting and audits and who are expert at identifying tax fraud schemes. We help you develop the best case before submitting it to the IRS Whistleblower Office on your behalf.
Although there are numerous tax fraud schemes, good IRS tax whistleblower cases generally involve one or more of the following three tax scenarios:
- Non-filing occurs when a taxpayer, intentionally or negligently, fails to file a tax return on time.
- Underreporting occurs when a taxpayer understates their income or overstates their deductions, exemptions and credits on their return.
- Underpayment occurs when a taxpayer files their return, but fails to pay the amount due on time.
The majority of good tax fraud whistleblower cases involve underreporting employment taxes and federal income tax fraud.
Taxpayers who seek to evade paying taxes often take overly aggressive positions on their tax returns. They are hoping the IRS will not challenge their positions.
The IRS has identified specific schemes that some businesses and wealthy individuals use to avoid paying taxes. Here are four of the most common big-dollar schemes:
- Offshore Tax Haven Abuse involves the creation of different types of offshore entities to conceal assets and income subject to tax by the United States, including foreign trusts, foreign businesses, offshore private annuities, offshore hedge funds, and offshore bank accounts.
- Tax Shelter Abuse involves multi-layer financial transactions that hide the owner of the money subject to tax by the United States, including IBC transactions, stock compensation transactions, lease in/lease out (LILO) transactions, and offsetting foreign currency option contracts.
- Money Laundering involves activities and financial transactions designed to hide the true source of money subject to tax by the United States, including money earned from illegal business activities such as ponzi schemes, securities fraud, and mortgage fraud.
- Employee Tax Abuse involves the improper withholding of federal employment taxes, including schemes involving pyramiding, third party payers, offshore employee leasing, false payroll taxes, and misclassification of worker status.
Tax fraud whistleblower cases are complex. To maximize your tax reward, you should always seek legal advice from an experienced IRS whistleblower attorney.
Choosing the Right IRS Whistleblower Attorneys Can Make All the Difference
Tax fraud whistleblower laws involve important technical and timing requirements.
If you have discovered federal tax fraud, you should act quickly. The IRS generally follows the first-to-file rule.
Under the first-to-file rule, only the first person to file an IRS whistleblower case is entitled to the reward.
This means that if you file your whistleblower claim even one day after another whistleblower files the same case, you may lose out on your whistleblower reward. As a result, if you are thinking about blowing the whistle, you should speak with an experienced IRS whistleblower lawyer right away.
When you are thinking about reporting tax fraud, protecting your identity is a critical consideration.
From the moment you speak with us, the information you provide us is protected by the attorney-client privilege. Your claim will then be confidentially filed with the IRS. Our legal team works with the IRS to protect your identity throughout the whistleblower process.
In most cases, the person or company you are filing the complaint against will never know that you have filed a whistleblower claim. However, you should know that there are limited circumstances where the IRS may have to call you as a witness in a legal proceeding.
These circumstances are rare. If they happen, we will always fight, along with the IRS, to ensure your identity is protected to the fullest extent under the law.
Working with a team of skilled IRS whistleblower attorneys can make the difference between winning and losing your whistleblower case.
We will help you build a compelling whistleblower case. We will help you comply with all of the technical requirements of the law. We will help you get the reward you deserve.
