You could benefit from reporting to the IRS this tax season
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You could benefit from reporting to the IRS this tax season

| Feb 9, 2019 | Qui Tam Cases |

Some people grew up in homes where telling on another person for their wrongdoings, otherwise referred to as tattling, was frowned upon. This is perhaps due to the idea that children’s zest for telling on a sibling is irritating for a parent. It could also have something to do with an effort to teach children to take responsibility for their own actions. However, telling on someone for their unethical or illegal behavior as an adult often has a completely different effect.

Many organizations, including governmental entities, implement whistleblower policies. In some cases, an employee might spot a violation in the daily operations of a company. As a result, employee reports can be invaluable to a business. For federal organizations, reports from the public can contribute to saving an agency a large sum of money.

Internal Revenue Service (IRS) whistleblower rewards

The IRS annual report for fiscal year 2018 shows collections of more than $1.4 billion in sanction related to tax fraud. Due to their whistleblower efforts, those who reported fraudulent tax activity received an excess of $300 million, collectively.

Certain laws apply to protect the anonymity and rights of the whistleblower from retaliation. And every whistleblower program works somewhat differently. However, if you seek to claim a reward from the IRS during the 2019 tax season, you might have some questions about how their program works.

3 common questions about IRS informant awards

Whether you hope to receive a financial award from the IRS or simply want to be an informed citizen, there are some things that may interest you about IRS whistleblower awards. Common questions include:

  • Under what circumstances does the IRS provide payment for information? The IRS offers financial compensation to those who provide credible information about the failure of another person to pay owed taxes, at a rate of up to 30 percent of the amount collected.
  • Will your information be confidential if you file a report? The IRS will protect your identity as much as legally possible. However, your identity may be revealed in instances involving a judicial proceeding.
  • How do you file a claim? If you become privy to information about possible tax fraud, you can send the appropriate form and supporting documents to the IRS.

The IRS whistleblower program is just one example of how beneficial it can be to offer an incentive for information provided. It also goes to show how important it is for people to step forward and make matters known.

Regardless of the situation in which you find yourself, you may or may not receive compensation for blowing the whistle on illicit activities. However, if you face problems because of your efforts to do the right thing, you might be able to make a case of your own.