Article reveals IRS’s mismanagement of whistleblower program

FALLS CHURCH, Va.  – In an exclusive news story published in Monday’s Tax Notes, Tax Analysts – the nonprofit provider of federal, state, and international tax news and analysis – unveils alleged wrongdoing and mismanagement in the IRS Whistleblower Office concerning a submission the IRS recently denied.

The article, written by contributing editor Jeremiah Coder, reports on a whistleblower’s journey over five years of dealing with the IRS.

According to the story, the informant’s file provides details on a prominent U.S. attorney who had earned over $30 million in unreported offshore income stored in several undeclared offshore bank accounts. The file includes an 11-page letter from the whistleblower to Senate Finance Committee member Chuck Grassley, R-Iowa, and 16 exhibits that attempt to corroborate the allegations.

“The IRS agents initially told the whistleblower the evidence indicated it would take about two years to resolve the claim,” Coder writes. “But over five years, the whistleblower continued to provide the IRS with more materials supporting his submission, which the IRS readily accepted without giving any indication of its progress on the matter.”

In February the IRS informed the whistleblower that it had rejected his award on the grounds that the submitted information did not lead to any collected proceeds of unpaid taxes.

“In addition to the hope of receiving an award, I thought I was helping to right a great injustice,” said the whistleblower. “Having cooperated fully with the IRS, I have instead been ignored for the better part of five years and have now paid the ultimate price by having my legal career wrecked by the IRS. The treatment of my whistleblower submission is indicative of a systemic failure of the IRS management to properly manage the IRS whistleblower program according to the legislative intent of Congress.”

The full article is available here.