What is an IRS whistleblower? An IRS whistleblower is someone who presents the IRS with evidence that proves that an individual or company is evading taxes or otherwise committing tax fraud. In the United States some form of income tax has existed off and on since 1862. With the establishment of the tax, whistleblowers have been around for almost as long. The laws rewarding and protecting IRS whistleblowers have changed remarkably little over the years. 

Some of the main changes have occurred in the last decade. While an IRS whistleblower reward used to be discretionary, the awards are now formalized in the law. To submit information and apply for an award in regard to that information, the IRS even has a form to file, IRS Form 211. This form should be filed with the new IRS Whistleblower Office at Internal Revenue Service, Whistleblower Office, SE: WO, 1111 Constitution Ave., NW, Washington, DC 20224. The rewards can be substantial, up to 30% on cases involving over $2 million or individuals earning over $200,000 per year, and up to 15% on smaller cases. There are even websites trying to entice you into becoming a professional whistleblower. 

The most recent changes to the law regarding IRS whistleblowers occurred in 2006. Since there appear to be some questions as to the legality of the new law, the policy hasn’t changed much yet. Rewards for information leading to the recovery of less than $2 million in taxes are still not required. The IRS may or may not pay an award, at their discretion. 

The main concerns an IRS whistleblower may have are confidentiality and protection. In most cases, the IRS tries to keep the identity of the informant a secret. However, if the IRS whistleblower is needed to testify in court, they will inform the whistleblower of this and then make their decision whether to proceed. We have all heard of famous whistleblowers. Their lives change drastically once they decide to proceed. Of course, not all of them were IRS whistleblowers. Some were able to keep their identity hidden for decades, such as Deep Throat. 

For the most part, you have to follow your conscience when you decide whether to become an IRS whistleblower. The types of crimes committed haven’t changed significantly. Even back in the old westerns, you could see the bad guys keeping two sets of books, one for the government officials and one, the real one, for themselves. That is still a common problem, as is paying employees with cash and then not reporting the income to the IRS. For a while fraudulent income tax shelters were leading the news. They haven’t disappeared. 

Another common crime is making up fictitious deductions on your income taxes. Sure, that houseboat was a business expense, why didn’t I think of that! Maybe because keeping your family entertained while you work is not a business expense? The IRS is most interested in the large cases, the ones that cost the taxpayers millions of dollars. If you find yourself privy to information which could lead the IRS to recover that kind of money owed to the government, you should seriously consider reporting the fraud on IRS Form 3949-A. It should be mailed to Internal Revenue Service, Fresno, CA 93888. If   you were hoping to call the IRS whistleblower phone number, try calling your local IRS tax assistance center. An overall number does not appear to exist. 

If you have a family that could be impacted by your decision to report a fraud, be sure to at least inform the adults in your immediate family of your decision and the impact it may have on their lives as well.