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IRS Awards and Rewards For Whistleblowers Finding Government Fraud

The amended IRS Whistleblower Statute provides for two types of awards and rewards: those disputes over or under $2 million dollars.

Over $2 Million Dollar Case

Under Sec. 7623(b), the award percentage ranges are statutory, with a general range between 15% to 30%, with some exceptions. The IRS will pay 15 percent to 30 percent of the amount collected if the taxes, penalties, interest and other amounts in dispute exceed $2 million and, if the case is brought against an individual, the individual's gross income exceeds $200,000 for any taxable year subject to such action.  A reduced award amount of up to 10% is given in cases based principally on disclosure of specific allegations resulting from: judicial or administrative hearings, a governmental report, hearing, audit or investigation or from the news media.  There is also an appropriate reduction if the whistleblower "planned and initiated" the non-compliance. If the whistleblower disagrees with the outcome of the claim, he or she can appeal to the United States Tax Court, within 30 days of such determination.  If the thresholds in 7623(b) are not met, section 7623(a) authorizes, but does not require, the Service to pay for information relating to violations of the internal revenue law that result in recovery of tax. [1]

Under $2 million Dollar Case

The IRS has a second type of award program for other whistleblowers - generally those who do not meet the dollar thresholds of $2 million in dispute or cases involving individual taxpayers with gross income of less that $200,000. These cases will continue to be considered under Sec. 7623(a).  Under this section, the awards are discretionary and are less, with a maximum award of 15 percent up to $10 million and the informant cannot dispute the outcome of the claim in Tax Court. [2]

For More Information on How to File an IRS Whistleblower Claim Please Contact: Shauna Itri at sitri@bm.net or 215-875-3049.

[1] These rules are found at Internal Revenue Code IRC Section 7623(b)

[2] The rules for these cases are found at Internal Revenue Code IRC Section 7623(a)

For more information on how to file an IRS whistleblower claim please contact Shauna Itri at sitri@bm.net or 215-875-3049.

If you have discovered evidence of government fraud, contact an experienced False Claims Act attorney before blowing the whistle. You may be entitled to a substantial reward and the legal protections afforded to whistleblowers under state and federal laws. The attorneys of Berger & Montague are nationally recognized experts in Whistleblower/Qui Tam actions with over a decade of experience pursuing these complex fraud cases. For more information or to schedule your confidential consultation, use the form on this page or call us at 1-800-424-6690.

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For further reading:
How IRS Whistleblower Claims & Cases Are Filed For Awards with Tax Fraud Lawyers
Free Case Analysis From A Qui Tam Lawyer
Broaden Laws For Qui Tam Relators
Why You Want The Government To Intervene On A Qui Tam Lawsuit

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