Our federal tax system is one of voluntary compliance: each taxpayer is expected to correctly report and pay their tax liabilities to the IRS. For a variety of reasons, this plan often fails. The IRS has many ways to find taxpayers who either fail to report their taxable income to the IRS, or intentionally report an amount lower than the true amount of income earned. This may infuriate honest taxpayers who want others to also pay their due share. Enter the IRS Whistleblower Office, led by IRS Whistleblower Office Director, John Hinman. The Whistleblower Office processes claims submitted by honest taxpayers, and distributes financial awards for original information that results in tax collection by the IRS.
Whistleblowers may be “exes” (ex-spouse, ex-employee, ex-neighbor, ex-friend). So long as the whistleblower has specific, timely and credible information, they can receive 15-30% of the proceeds collected attributable to the information provided by the whistleblower.
For more information about the process, or to file a form, click here.