IRS Whistleblower Office Highlights Importance of Whistleblowing & Efforts to Improve Whistleblower Program

The Internal Revenue Service (IRS) Whistleblower Office recently released its first-ever multi-year operating plan. While the IRS Whistleblower Office (the “Office”) began operating in 2007, it remained relatively unknown—and thus relatively inactive—until its current Director, John Hinman, took over in 2022. In the fiscal year 2024, the IRS Whistleblower Office paid more than $123 million in whistleblower awards—the third-highest total in the Office’s history—and Hinman has stated that his goal is to continue increasing collaboration between the Office and private citizens going forward.

To this end, the IRS Whistleblower Office’s Operating Plan (the “Operating Plan”) identifies several goals, priorities, and targets for the years ahead. It also clearly acknowledges the role that whistleblowers play in helping the IRS uncover tax fraud, tax evasion, and other financial crimes, stating:

“The IRS uses increasingly sophisticated data analytics and other methods to detect non-compliance with tax laws, but we can’t find it all by ourselves. We need help from whistleblowers – people with firsthand knowledge of non-compliance who are willing to share what they know with us so we can investigate it when warranted.”

The Operating Plan also states that the IRS as a whole is committed to “continuous improvement of the IRS Whistleblower Program.” This includes, “using high-value whistleblower information effectively [and] awarding whistleblowers fairly and as soon as possible.”

The IRS Whistleblower Office’s Six Strategic Priorities for 2025-2027

A key feature of the IRS Whistleblower Office’s Operating Plan is its “Framework of Strategic Priorities.” This framework identifies six specific priorities that the Office intends to pursue in 2025, 2026, and 2027: 

1. Enhance the Claim Submission Process to Promote Greater Efficiency 

The Operating Plan states that the IRS Whistleblower Office “is evaluating current whistleblower claim intake, analysis, and classification processes and is working on improvements that will help ensure high-value submissions are identified and prioritized.” It also notes that the Office is taking steps to improve the efficiency of the IRS whistleblower process and enhance awareness of the IRS Whistleblower Program. 

In 2025, the Office plans to take steps including adjusting staffing resources, creating an online digital filing portal, and improving its intake and analysis processes. In 2026 and 2027, it plans to enhance its outreach efforts on specific tax-related compliance issues and review the current award payment thresholds for IRS whistleblower rewards. 

2. Use High-Value Whistleblower Information Effectively

While one of the overarching goals of the IRS Whistleblower Office’s Operating Plan is to increase the number of whistleblowers who come forward, it also makes clear that the Office is focused on “high-value” complaints while being less interested in “speculative” claims. Additionally, while the Office accepts complaints involving all types of violations falling within its enforcement authority, the Operating Plan states that the Office is “work[ing] to align [its] claim priorities with the IRS’s portfolio of strategic enforcement priorities”—which the IRS identified in its Strategic Operating Plan last year.

In 2025, the Office plans to take steps including improving its claim management system and increasing its efforts to work more closely with whistleblowers. In 2026 and 2027, it plans to take a look at the best practices implemented by other federal whistleblower programs, such as the Securities and Exchange Commission (SEC) Whistleblower Program and the program operated by the U.S. Commodity Futures Trading Commission (CFTC).

3. Award Whistleblowers Fairly and As Soon As Possible 

As the IRS Whistleblower Office explains, “[t]he IRS pays awards from proceeds collected and as such, award payments can only be made once the taxpayer has exhausted all appeal rights, and the taxpayer no longer can file a claim for refund or otherwise seek to recover the proceeds from the government.” Even so, the Operating Plan states that the office is working on taking steps, “to help ensure whistleblower claims are fairly considered and awarded as soon as the law and resources permit.”

In 2025, these steps include reviewing the Office’s procedures for determining targeted taxpayers’ liability and processing reconsideration requests. In 2026 and 2027, the Office plans to take steps including emphasizing collection efforts in whistleblower-initiated cases and exploring additional flexibility for whistleblower award payments under Section 7623(a) of the Internal Revenue Code. 

4. Keep Whistleblowers Informed of the Status of Their Claims and the Bases for IRS Decisions on Claims

The Operating Plan states that the IRS Whistleblower Office, “will continue to invest in services for whistleblowers and representatives through improved communications . . . [and] work with the Office of Chief Counsel to improve the administrative claim review process . . . .” This includes providing improved communications at the audit and collection stages of the IRS’s enforcement process.

In 2025, the IRS Whistleblower Office plans to take steps including standardizing procedures and improving its formal notification processes. In 2026 and 2027, it plans to take steps including considering potential regulatory action to further protect whistleblowers and improve disclosures regarding whistleblower-initiated cases under Section 7623(a).

5. Safeguard Whistleblower and Taxpayer Information 

While safeguarding whistleblowers’ identities is a core component of the IRS’s Whistleblower Program, the Operating Plan states that the IRS Whistleblower Office plans to take additional steps to strengthen tax whistleblower protections related to “confidentiality, security, and privacy” in the years ahead. It also notes that, in 2024, the Office revised its guidance on Freedom of Information Act (FOIA) requests to “strengthen controls over and protection of whistleblower records,” consistent with some other federal whistleblower protection laws.

6. Ensure that the Office’s Workforce is Supported with Effective Tools, Technology, Training, and Other Resources 

Going forward, the IRS Whistleblower Office plans to continue focusing on hiring and retention of qualified government employees to strengthen its operations and facilitate the efficient handling of whistleblower complaints. The Operating Plan also expresses a commitment to, “drive change by continuously assessing and monitoring employees’ feedback,” and ensure that its staff members have the resources they need to do their jobs effectively. 

Recent Achievements and Awards Under the IRS Whistleblower Program 

Along with highlighting these six strategic priorities for the future, the IRS Whistleblower Office’s Operating Plan also highlights some of the Office’s achievements in the past. These achievements include: 

• Hiring 36 additional employees in 2024 (a 75% increase in staffing) with a specific focus on improving whistleblower claim processing, whistleblower communication, and data analytics. 
• Updating Form 211 (Application for Award for Original Information), which is the form that whistleblowers must use to submit complaints to the IRS. The updates improve the form’s organization and add new options for reporting violations that may be included in whistleblower disclosures, addressing concerns frequently raised by whistleblower advocates. 
• Revising the Internal Revenue Manual (IRM) to clarify the factors that allow for “disaggregation,” which is when the IRS separates pending actions from completed ones in order to facilitate earlier whistleblower payments. 
• Beginning the process of developing an online digital intake portal for whistleblower complaints and adding additional office locations across the United States. 
• Developing internal measures and metrics that will allow the Office to better assess the efficiency of its operations and target additional improvements going forward. 

Since opening in 2007, the IRS Whistleblower Office has paid more than $1.3 billion in whistleblower rewards, and the IRS has collected more than $7.4 billion as a result of whistleblower tips and complaints. This reflects an average whistleblower award of roughly 17.5% of the amount recovered. 

Last year, the IRS Whistleblower Office issued a record $74 million award to three anonymous joint whistleblowers who helped the IRS recover $263 million—an award of 28% of the amount recovered. As Bloomberg Tax reported at the time, “the size of this award, and the reported speed it was issued, seem to be a sign that the IRS Whistleblower Office is righting the ship. It’s a testament to the dedication of the office’s staff and recent reform efforts initiated by its director.”

Serving as an IRS Whistleblower

With all of this in mind, are you eligible to serve as an IRS whistleblower? As discussed above, the IRS Whistleblower Office accepts complaints from private citizens involving not only tax evasion and tax fraud, but also insider reports on tax cheats and other perpetrators of federal financial crimes. This includes everything from Bank Secrecy Act (BSA) and anti-money laundering (AML) violations to Foreign Corrupt Practices Act offenses and fraud under the pandemic-era Paycheck Protection Program (PPP) and Employee Retention Credit (ERC) program. 

Eligible whistleblowers who assist the IRS with pursuing successful enforcement actions are entitled to an award of 10% to 30% of the amount the agency recovers under the IRS whistleblower program. However, whistleblowers must follow the Office’s procedures for coming forward (i.e., properly completing and filing Form 211), and they must be prepared to work with the IRS throughout the investigative process. At Oberheiden P.C., we represent IRS whistleblowers nationwide. With our attorneys’ and consultants’ prior experience in federal white-collar enforcement, we are well-versed in the federal investigative process, and we are able to work effectively with federal agents and prosecutors on behalf of our clients. 

Schedule a Free and Confidential Consultation with an IRS Whistleblower Attorney at Oberheiden P.C.

If you would like to know more about the process of filing a whistleblower complaint with the IRS Whistleblower Office, we invite you to get in touch. To schedule a free and confidential consultation with a senior IRS whistleblower lawyer at Oberheiden P.C., please call 888-680-1745 or tell us how we can contact you online today.