WASHINGTON – Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) are today introducing the IRS Whistleblower Program Improvement Act, which would strengthen the Internal Revenue Service’s (IRS) successful Whistleblower Awards Program. That program has enabled the agency to collect over $6 billion from wealthy individuals and businesses caught dodging taxes.
In addition to the $6 billion directly recovered through the whistleblower program, it has yielded additional billions from the indirect impact on taxpayer compliance, such as the Offshore Voluntary Disclosure Program (OVDP). The OVDP was created as a direct result of actionable information brought to the IRS by whistleblowers.
“The IRS whistleblower program has been a genuine success for American taxpayers. We ought to do whatever we can to ensure its continued success, so tax dodgers and fraudsters pay what they owe. Toward this end, it’s vital that whistleblowers who come forward are protected and treated fairly,” Grassley said.
“IRS whistleblowers play a critical role in protecting taxpayer dollars and finding tax cheats stealing from the American people. It would be far more difficult to uncover these illegal schemes without their courage, and our bill would strengthen protections for these brave Americans when they come forward,” Wyden said.
The IRS Whistleblower Program Improvement Act includes seven measures to bolster the successful program, ensure fairness and protect the whistleblowers who come forward. The bill would provide for De Novo review in appeals heard by the U.S. Tax Court—allowing for new evidence to be admitted to the record, and establishes a presumption of anonymity for whistleblowers before the court. The legislation also exempts whistleblower awards from budget sequestration, provides that interest be paid to awardees if the award has not been paid within one year, brings the tax treatment of attorney’s fees into line with other whistleblower programs, and allows the IRS to retain some proceeds for the administration of the program. Lastly, it improves the program’s annual report to Congress to help tax writers identify areas in most need of attention.
The legislation is supported by the National Whistleblower Center.
“NWC fully supports the introduction of the IRS Whistleblower Program Improvement Act. By adopting these important reforms to the successful IRS whistleblower awards program, Congress will provide a much improved avenue for whistleblowers who wish to come forward to report evidence of tax fraud. This is a huge step for whistleblowers and NWC thanks Senator Grassley for his continued efforts to protect whistleblowers,” National Whistleblower Center Executive Director Siri Nelson said.
Full legislative text of the IRS Whistleblower Improvement Act can be found HERE. A summary of the bill can be found HERE.