Federal Tax Fraud Attorneys Standing With You to Reveal the Truth

Federal tax fraud and avoidance undermine the integrity of our financial systems and place an unfair burden on law-abiding taxpayers. Whistleblowers who identify and report these offenses to the IRS are crucial to holding fraudulent individuals and companies accountable and ensuring transparency.

• Types of federal tax fraud and tax evasion are numerous and may include illegal tax shelters, hiding income, or wrongly claiming tax credits.
• Insiders, tax experts, and even innocent taxpayers recruited into schemes play a critical role in exposing undetectable schemes, helping the IRS recover millions in unpaid taxes annually.
• Anyone with information about tax law violations can file a whistleblower tip, regardless of their employment status with the offending company.

At Whistleblower Partners LLP, our attorneys empower individuals to take a stand against federal tax evasion by providing unparalleled legal understanding, confidentiality, and support. We are committed to guiding you through this challenging yet vital process.

Who Investigates Violations of Federal Tax Laws?

The Internal Revenue Service (IRS) is primarily responsible for pursuing individuals and companies who fail to pay their taxes, whether by fraud, negligence, or mistake. The IRS also has the authority to enforce foreign bank account reporting (FBAR) requirements. When tax frauds or FBAR violations are intentional, the Department of Justice (DOJ) can bring criminal charges. The IRS Whistleblower Program pays rewards to whistleblowers reporting any of these violations.

What Kinds of Tax Frauds Can Whistleblowers Report?

Whistleblowers can bring the IRS information about any failure to pay taxes, whether fraud, negligence, or mistake.

Every year, the IRS targets a wide variety of tax frauds by corporations and individuals:

• Illegal tax shelters created for the sole purpose of evading taxes. Common examples include fictitious retirement plans, abuse of partnerships and tax-exempt organizations, improper stock and deferred compensation agreements, and many other complex financial arrangements designed to create improper tax results. The IRS maintains an Office of Tax Shelter Analysis focused on combating these abusive tax shelters and transactions.
• Hiding income using offshore tax havens, shell companies, and trusts.
• Failing to report earnings from cryptocurrency transactions, which the IRS treats as income.
• Improperly claiming tax credits, particularly tax credits for fuels, renewable energy, and employee retention.

When it comes to enforcement, the IRS frequently targets those who design and promote these schemes. The Service has established an Office of Promoter Investigations focused exclusively on detecting and deterring abusive tax promoters, enablers, and tax return preparers.

The IRS also goes after taxpayers who hide money or assets offshore. In addition to investigating tax underpayments, the IRS also has the authority to penalize taxpayers for failing to file a Report of Foreign Bank and Financial Accounts (FBAR). Under the Bank Secrecy Act, U.S. citizens, residents, corporations, and other entities must file FBAR reports if they have a financial interest in or authority over one or more foreign financial accounts whose aggregate value exceeds $10,000 at any time during the calendar year. The penalties for failing to file can be substantial. For willful violations, the penalty can reach up to the higher of $100,000 or 50% of the account balances that the person fails to report. In egregious cases, the Department of Justice can also criminally prosecute the failure to file FBAR reports.

The IRS relies heavily on whistleblowers to shut down these tax schemes. From the outside looking in, it is often impossible to tell when a company is hiding assets overseas or failing to report significant income. As a result, insiders play a critical role in alerting the IRS to otherwise undetectable frauds. But whistleblowers do not have to be insiders. Tax-shelter promoters constantly recruit new taxpayers, and those innocent taxpayers can report the schemes to the IRS. And sometimes, tax experts can detect tax evasion through complex analysis. Whether insider or outsider, whistleblowers play an indispensable role in helping the IRS collect hundreds of millions of dollars in unpaid taxes each year.

Who Can Be an IRS Whistleblower?

Almost anyone with information about a violation of the laws and regulations enforced by the IRS can file a whistleblower tip. You do not need to be an employee of the company engaging in misconduct to qualify as a whistleblower. Read more about the specific requirements of the IRS Whistleblower Program on our IRS Whistleblower Program page.

How Does the IRS Protect Whistleblowers?

The IRS is generally required to maintain the confidentiality of whistleblowers, and in the vast majority of cases, the IRS keeps the identity of the whistleblower confidential throughout its investigation. The IRS Whistleblower Program also protects whistleblowers from employer retaliation, including firing, demoting, suspending, threatening, harassing, or discriminating against whistleblowers. Whistleblowers who are retaliated against may sue for reinstatement, back pay, and other damages. These protections apply whether or not a whistleblower receives an award, as long as the whistleblower had a reasonable belief that a violation of the tax laws occurred.

Representative Cases

• $79 Million Whistleblower Award – We represented a client who, along with two other whistleblowers, received a maximum 30% reward in the total amount of $79 million for helping expose and shut down a longstanding and complex tax fraud. It is one of the largest awards in the IRS whistleblower program’s history. Because of the information provided by the whistleblowers, the government recovered $263.7 million in unpaid taxes, penalties, and interest from the taxpayer.
• $8 Billion Ponzi Scheme – We represent Charlie Rawl and another whistleblower who together exposed one of the largest Ponzi schemes in history, engineered by Allen Stanford. The scheme caused $8 billion in losses to investors, which the government continues to collect. The IRS has recognized that our clients are entitled to a reward for their role in revealing the massive fraud, though the final amount has not yet been determined.