IRS Whistleblower Lawyers

We are a globally recognized and celebrated as the leading whistleblower law firm representing IRS whistleblowers in cases involving tax fraud and evasion. Since 1988 we’ve gone up against the world’s greediest criminal enterprises, oligarchs, and major corporations.

Our attorneys are behind the first whistleblower award in history where a whistleblower obtained over $100 million in compensation. In this case our client Bradley Birkenfeld, a former UBS banker, forced UBS to pay fines of $780 million, disclose the names of 4,450 U.S. taxpayers with offshore Swiss accounts.

We set precedent that whistleblowers who participated in the tax fraud (i.e. worked as a banker in Switzerland servicing U.S. clients) could qualify for an award. We successfully argued that Birkenfeld was entitled to a $104 million payment, even though he plead guilty to one count of tax fraud.

We represent Howard Wilkinson, a former Danske Bank manager who exposed a Russian $230 billion money laundering scheme that aimed to move rubles from Russia to Estonia, convert them into dollars, and then to New York with the help of several major U.S banks.

Furthermore, we’ve been intimately involved in writing the rules for the Internal Revenue Service (IRS) Whistleblower Program – we’ve engaged in rulemaking petitions with government officials and regulators, testified at rulemaking hearings, filed amicus curiae briefs in precedent-setting tax whistleblower cases, and helped push for legislation to improve the efficacy of the Program.

In Tax Court we have successfully challenged IRS decisions denying whistleblower awards due to late-filed Form 211s and set the precedent permitting whistleblowers to collect awards based on Department of Justice criminal prosecutions and civil forfeitures.

Our firm is dedicated to representing courageous whistleblowers who uncover and report all forms of tax violations. We have a proven track record in cases involving complex schemes like offshore tax havens and illegal shell bank accounts, as well as more common issues such as false financial reporting and the failure to pay or report taxes of all kinds.

If you’re an individual with information about such violations, there’s no better firm to represent you and help you get an award. Get in touch with our attorneys today for a free and confidential case evaluation – we only get paid if we win your case.

Since the Tax Relief and Health Care Act established the modern IRS Whistleblower Program in 2006, our award-winning attorneys have engaged in consistent advocacy to ensure whistleblowers are awarded, protected, and honored for their information.

Our Firm’s Success is Unparalleled

Below is a short overview of some of the awards that we’ve helped our clients obtain. Note: given the secretive nature of the IRS, only some names are provided, such as our client Bradley Birkenfeld, the recipient of the largest whistleblower award at the time (2012).

There are many forms of tax evasion, some of which are more deliberate than others. Regardless of form, the main idea behind tax evasion is to save money by avoiding the payment of federal or state taxes through various tactics, which might include the following:

• Concealing Income: This includes underreporting income, utilizing offshore tax havens, or failing to report income from illegal activities like organized crime.
• Fabricated Records: This covers having multiple sets of financial records (“books”), using false or altered documents, or claiming false exemptions or deductions.
• Misrepresenting Identity/Status: This includes claiming residency in a different state or country to avoid taxes, or claiming dependents that don’t qualify.
• Improper Tax Filing: This involves filing late tax returns, failing to withhold taxes properly, or neglecting to follow tax laws altogether.
• Shifting Assets: This includes concealing assets or using illegal property easements to avoid taxes.
• Undue Use of Credits/Deductions: This involves claiming excessive or fraudulent credits and deductions on tax returns.

There are many other types of tactics tax fraudsters will deploy to evade taxes. You can learn more about it by reading 26 U.S.C. § 7201 or by visiting our FAQ on the topic.

The IRS Whistleblower Office, which was created in the passing of the Tax Relief and Health Care Act of 2006, pays monetary awards to whistleblowers who provide the IRS with specific and credible information regarding tax non-compliance, such as tax evasion, fraud, and other violations.

IRS Whistleblower Award

The IRS pays whistleblower awards (not rewards) between 15% and 30% of what the government recovers, which includes taxes, interest, and penalties. In fiscal year 2024, the IRS paid awards totaling $123.5 million based on tax and other amounts collected of $474.7 million attributable to whistleblower information.

Eligibility & Requirements

To become eligible for an award, a whistleblower must provide the following:

• Specific and Credible Evidence: Whistleblowers must have strong evidence of tax underpayment or violations of internal revenue laws. The IRS is looking for “solid information, not an ‘educated guess’ or unsupported speculation.”
• Meet the $2 Million Recovery Limit: The government’s recovery must exceed $2 million. The $2 million threshold can be aggregated over several tax years. If the case deals with an individual, his or her annual gross income must be more than $200,000.
• Anyone Can Become Eligible: You do not have to be a U.S citizen to become eligible for an award; and more than one individual can file a claim and become eligible for an award. The amounts are determined based on each whistleblower’s investigative support.

It’s important to note that whistleblowers will not receive an award until the IRS collects the taxes that are owed, as well as penalties or interest owed, and until the taxpayer exercises the right to administrative and judicial appeals, which can take many years to resolve.

Furthermore, it is possible for a whistleblower to receive an award if their information is derived from public information. However, the award percentage may be less and depends on how the information contributes to the investigation.

Can I File Anonymously?

Although anonymous filing is not permitted, the IRS has a strong track record of keeping whistleblowers’ information confidential. The identity of a whistleblower is generally kept private, but must be disclosed in order to grant an award once a case has concluded.

Protection from Retaliation

Those who are identified and experience retaliation are entitled to protection from their employer for reporting tax non-compliance issues.

The IRS Whistleblower Office is responsible for overseeing the IRS Whistleblower Program and is who will be the one investigating submissions.

Given the very strict rules and guidelines you must follow when submitting a complaint, we highly recommend hiring an IRS whistleblower attorney in cases involving tax non-compliance.

1. Prepare Your Submission: Prepare and submit your information using IRS Form 211, Application for Award for Original Information. This complaint will go straight to the IRS.
2. Waiting Period: Your submission will then be queued for investigation, and you will likely not receive another notification from them, unless it is for an interview or case status update.
3. Case Results: You will be notified if your case is closed, if an award is payable, and the amount of that award. If you have an attorney in connection with your case, they’ll also receive notice.

This is a general overview of the process. Filing a claim is much more complex and requires expert legal guidance to ensure whistleblowers receive the maximum award amount. This is why we strongly encourage you to get in touch with our IRS whistleblower lawyers for a free consultation to determine eligibility.

Awards for Reporting Tax Evasion

If the taxes, penalties, interest and other amounts in a dispute exceed $2 million, other qualifications are met, the IRS may award the whistleblower between 15 percent to 30 percent of the amount collected. Amounts of course depends on several factors, which include the following:

Positive Factors

• Quality of Information: Specificity and credibility of evidence provided (strong financial records, witness accounts). Uniqueness of the information (not readily available from public sources).
• Significance of the Case: Amount of tax recovery generated by the information (higher recoveries lead to higher percentages). Whether the case involves complex tax schemes or high-net-worth individuals.
• Whistleblower’s Contribution: How much the information directly contributed to IRS action (leading role vs. supporting evidence). Early reporting allows the IRS to intervene sooner (positive impact).

Factors that Decrease Award Percentage (Negative):

• Publicly Available Information: If the information was already known or easily accessible, the award percentage is reduced.
• Whistleblower’s Role in Noncompliance: If the whistleblower participated in the tax violation, the award percentage may be significantly reduced or eliminated.
• Late Reporting: Delaying the report can hinder the IRS investigation and may decrease the award percentage.

It’s important to note that there are other factors that can increase or decrease an award amount, such as if the whistleblower has experienced retaliation, if they’ve been rewarded before, and their level of cooperation in a case.

From 26 U.S. Code § 6501 – Limitations on assessment and collection

Key Timeframes for Reporting Tax Underpayment:

• General Rule (3 Years): Tax underpayment should generally be reported within three years of the date the incorrect tax return was filed or the due date of the return, whichever is later.
• Substantial Understatement of Income (6 Years): If the tax return understates gross income by more than 25%, the time limit for reporting is extended to six years.
• Fraud (Indefinite): If a false or fraudulent tax return was filed with the intent to evade tax, or if there was a willful attempt to evade tax, or if no return was filed at all, there is no time limit. The IRS can assess tax, or a proceeding in court for collection can begin, at any time.

While these are the general statutes of limitation for the IRS to act, it is advisable for whistleblowers to report information as soon as possible. The IRS typically prefers more time remaining on the statute to begin and complete an examination.

Tax evasion cases are complex and must be fought with experience – especially if they involved millions of dollars and an award is at stake. Tax evasion attorneys can help in several ways, which includes the following:

• Case Evaluation: a tax evasion attorney specializing in whistleblowing can help assess the strength and qualify of your case and its potential of being picked up by the IRS.
• Protection: a tax evasion attorney can help protect your anonymity, and also protect you against retaliation from employers.
• Maximize Awards: a tax evasion attorney can help you maximize your award potential by building a strong case, negotiating, and helping you meet certain deadlines.
• Legal Representation: an attorney will be your liaison between you and the IRS, and assist with any disputes along the way to ensure you have the best chances of winning.

A tax evasion attorney who deals in whistleblower claims can provide a wealth of expertise, experience, and confidentiality, ensure their rights are protected and challenges overcome.

If you’re thinking about reporting tax non-compliance, you want the best IRS whistleblower law firm on your side. Contact Kohn, Kohn & Colapinto for a free and confidential consultation.