Types of Cases

Types of Cases

Cases that Qualify under the Tax Whistleblower Reward Program

Information regarding a wide range of tax issues, both criminal and non-criminal in nature, may lead to a reward under the Tax Whistleblower Reward Program.  A common misperception is that, in order to be entitled to a reward under this Program, you must possess information regarding tax fraud or criminal tax evasion.  However, this Program is not limited to issues rising to the level of tax fraud or criminal tax evasion.

Providing information that assists the IRS in determining any type of underpayment of tax is sufficient to qualify under the Tax Whistleblower Reward Program.  However, the minimum amount of tax, interest, and penalties must exceed $2,000,000.  The underpayment of tax could even be from an innocent mistake, a difference of opinion as to the interpretation of the law (i.e., the “gray area of the law”), or an incorrect valuation of a piece of property.  The IRS has provided the following non-exhaustive list of examples of activity, both criminal and non-criminal, for which a reward could be earned by providing information:

Corporate Fraud
The IRS is interested in securities fraud against shareholders and fraud committed by corporate officers against a company.  Corporate fraud frequently involves violations of the Internal Revenue Code through falsification of corporate and individual tax returns.  (More Corporate Fraud Information)
Money Laundering
Money laundering is a very complex crime involving intricate details, often involving numerous financial transactions and financial outlets throughout the world.  It consists of an act of hiding money or income earned from both illegal and legal activities.  (More Money Laundering Information)
General Tax Fraud
The efforts of the IRS are directed at those American taxpayers who willfully and intentionally violate their known legal duty of voluntarily filing income tax returns and/or paying the correct amount of income, employment, or excise taxes.  These individuals pose a serious threat to tax administration and the American economy.  (More General Tax Fraud Information)
Abusive Return Preparer
The IRS is interested in return preparers who willingly overstate deductions or understate income for their clients. Sometimes such return preparers systematically underreport the tax liability of thousands of clients.  Many of these return preparers charge exorbitant fees or a percentage of the underreported tax liability in exchange for their unscrupulous services.  (More Abusive Return Preparer Information)
Loopholes and Tax Shelters
These abusive tax schemes originally took the structure of abusive domestic and foreign trust arrangements.  However, these schemes have evolved into sophisticated arrangements that take advantage of the financial secrecy laws of some foreign jurisdictions and the availability of credit/debit cards issued from offshore financial institutions.  (More Loopholes and Tax Shelter Information)
Non-filer Enforcement
There have always been individuals who, for a variety of reasons, argue that taxes are voluntary or unconstitutional. The courts have repeatedly rejected their arguments as frivolous and routinely impose financial penalties for raising such frivolous arguments.  In recent years, the IRS has placed a high priority on identifying these individuals.  (More Non-filer Enforcement Information)
Employment Tax Enforcement
The underreporting of employment tax can take a variety of forms.  Some of the more prevalent methods of underreporting include pyramiding, employee leasing, paying employees in cash, filing false payroll tax returns, or failing to file payroll tax returns.  (More Employment Tax Enforcement Information)
Fuel Excise Tax Enforcement
Unscrupulous individuals and corporations continue to devise schemes to evade Federal and state motor fuel excise tax--revenue that is needed to maintain and improve our national transportation systems.  The impact of these schemes goes far beyond the revenue loss; they have an adverse effect on the motor fuel industry by eroding the market share of legitimate dealers and even forcing some out of business.