IRS Tax Bounties Can Make You Very Rich

Ever get angry that you have to pay the IRS a big chunk of your income, but others don’t play fair and get away with it?  This is your chance to penalize evaders and get rich rewards, all from the IRS.

Join the ranks of the whistleblowers!  The number of taxpayer whistleblowers increased over 400% in 2008.[1] Currently, the IRS Whistleblower’s Office estimates about 8 submissions are filed daily.[2] Why the increase?  As of 2008, Section 7623(b) was added stating that the IRS is required to give a bounty reward for any person who submits information that substantially contributes to the collection of a tax, penalty or interest.  The reward is given as a percentage of the amount collected, meaning big time payouts.

The whistleblower only needs specific and credible evidence of the violation.  IRC Section 7623(b) gives a mandatory reward of 15-30% if the IRS collects over $2 million because of the information given.  It is also mandatory if the accused taxpayer is an individual with over $200,000 in gross annual income.  This requirement was not implemented until 2006 Amendments were put into place mandating the reward and eliminating a cap on possible rewards.

The IRS is willing to reward the information that results in smaller claims as well.  Section 7623(a) still applies if an individual provides information about a violation that does not meet the threshold amounts above.  In those cases, the whistleblower may receive a discretionary reward of up to 15% of the collected amount with a cap of $10 million.

Finally, the confidentiality of the whistleblower is protected. The IRS stated in Notice 2008-4 that they will protect the confidentiality of the whistleblower.

Should you have any questions regarding a particular case, feel free to contact us for a no obligation consultation.

[1] IRS Whistleblower Office Annual Report to Congress

[2] Donmoyer, Ryan J., Americans Seeking Reward Money Inform IRS on Others, Bloomberg Businessweek, May 4, 2010

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