Help Fight Tax Fraud By Becoming An IRS Whistleblower
Paying taxes is tiresome to say the least. After all, wouldn't it be great to keep all of our hard earned dollars for ourselves instead of having to share our earnings with the government. Whilst the majority of American citizens diligently pay their taxes there are, unfortunately, fraudsters who avoid paying their taxes in any way they can. At present the amount of tax owed to the government is sitting at around three hundred billion dollars that is a pretty hefty shortfall by anyone's standards.
So how are the government looking to recover that lost revenue?
The government, and more specifically the IRS, have taken steps to introduce a whistleblowing provision, which means that if you suspect that your employer is avoiding the tax man, then you, as an IRS whistleblower, can report their actions and reap a share of the monies recovered.
IRS Whistleblowers
Under the ruling of a mandate made by congress in 2006 everyday citizens can speak out against individuals or companies who they suspect are not paying their taxes or are paying insufficient taxes. However, this isn't quite as simple as it sounds. For example it's not about reporting on your neighbor just because his dog keeps you awake at night, or dishing the dirt on your employer just because he gave you a dressing down. The amounts of tax evasion need to be substantial and you need to provide credible and specific information to the IRS so that they can act upon it. Generally speaking the following criteria apply before you can report any tax fraud, namely:
- The total amount of the alleged tax fraud needs to be in excess of $2 million including interest, penalties and anything else that the government might want to include;
- If you're reporting on an individual, then their income needs to exceed $200,000 per annum.
If you believe that you have uncovered a tax fraud, then in the first instance you need to speak to an attorney who will listen to your allegations and advise you accordingly. In most cases any attorney will operate a free consultation so just by airing your concerns, it won't cost you a dime. Should he decide you have a case he will be able to help you file a lawsuit and will be there to see you through every step of the way. He will operate on a contingency basis, which means that there are no upfront fees and he will get paid from the settlement figure once the case is won.
Confidentiality of an IRS Whistleblower
The IRS will protect the whistleblower to the full extent of the law. Usually the case is sealed which means that the identity of the whistleblower is not revealed, and the person or company being investigated will not know that they are under investigation during this time. However, under some circumstances, if the whistleblower is required to be a witness, then it may not be possible for the investigation to go ahead without revealing the identity of the whistleblower.
Rewarding the whistleblower
If your claim goes ahead and is proven, then you will be eligible for between 15and 30% of the total amount of monies recovered. Since claims can run into millions, this is a very attractive reward. Discretionary awards apply in cases where the amount of money involving a company is less than $2 million or in the case of individuals committing tax fraud, their gross income is below $200,000 per annum.
Protection against retaliation
Should it become common knowledge that you have blown the whistle on your company, then provisions are in place under qui tam law, to protect you from retaliation and reprisal, whether or not the case goes to court. For example your employer is not allowed to do any of the following:
- fire you from your job
- suspend your job
- demote your position
- pass you over for overtime
- harass you
- threaten you in any way
Should you become victim to any of these acts, then you would be able to file for damages directly against your employer for such things as loss of wages, reputation, and emotional stress and trauma.
Reporting against tax evasion and fraud is the right thing to do, and although becoming an IRS whistleblower can be a long, drawn out process, not only is there the moral perspective of having done the right thing, but also in addition you may well receive a life-changing sum of money.
