IRS Whistleblower Actions
As long as there have been taxes, there have been taxpayers who try to avoid them. But there is a big distinction between legitimate strategies to keep taxes to a minimum and illegal efforts that constitute tax fraud or tax evasion. Every year, corporations and individuals engage in a range of illegal tactics that defraud the federal government of billions of dollars in owed taxes.
While the Internal Revenue Service (IRS) has agents, accountants, and lawyers whose job it is to uncover fraud and collect unpaid taxes, there are more instances of illegal tax avoidance than they can track. That is why the IRS provides private citizens with financial incentives to report significant cases of tax fraud and tax evasion to the government.
The IRS Whistleblower Program
The IRS Whistleblower Program provides a financial incentive to individuals to report significant tax fraud schemes by corporations or high net-worth individuals. As the IRS Whistleblower Office notes, it is looking for “solid information, not an ‘educated guess’ or unsupported speculation.” The alleged fraud also must involve a significant federal tax issue; the Whistleblower Program is not a means of “resolving personal problems or disputes about a business relationship.”
Any individual who reports information that leads the IRS to recover at least $2 million in unpaid taxes, interest, and penalties is entitled to receive an award of between 15 percent and 30 percent of the amount recovered. IRS Whistleblower claims are filed confidentially and, if the claim is successful, the IRS does not identify award recipients.
Tax Evasion and Tax Fraud Supporting IRS Whistleblower Claims
Given the complexity of the tax code, there are many illegal ways to try to evade tax obligations. Some of the most common examples of tax fraud and tax evasion include:
- Failing to report or underreporting income
- Failing to file tax returns
- Making false statements in tax returns
- Claiming inapplicable or improper deductions
- Inflating deductions or expenses
- Sham transactions
- Hiding money in offshore accounts
- Filing false returns seeking fraudulent tax refunds
How Youman & Caputo Helps IRS Whistleblowers
IRS whistleblower claims have a low success rate, and even when extensive credible evidence is presented to support such claims, the IRS conducts an extensive investigatory process and engages in multiple levels of review, meaning award decisions often take five years or longer. As a result, many lawyers who handle these claims do not invest the time or resources necessary to maximize the chances of obtaining compensation for the whistleblower.
At Youman & Caputo, we take a unique approach to IRS whistleblower claims. We are highly selective about the cases we accept, generally limiting them to tax loss to the government of at least $10 million. With the assistance of a retired IRS criminal agent consultant, we proactively reach out to the IRS and the Department of Justice to provide our client’s information. If the case is promising, this approach often results in the IRS or DOJ meeting with our client at a very early stage. We then remain in close contact with government lawyers and agents throughout their investigation, increasing the chances of a positive outcome.
Youman & Caputo: Philadelphia IRS Whistleblower Attorneys
Youman & Caputo’s IRS whistleblower lawyers have represented clients reporting tens of millions of dollars in tax fraud to the IRS and have successfully obtained substantial compensation for those who report tax fraud and tax evasion.
If you are aware of such conduct and want to learn more about the IRS Whistleblower Program and how we can help you obtain compensation for exposing tax fraud, please call Youman & Caputo at (215) 302-1999 or contact us to arrange for a consultation.