IRS Whistleblower Awards

Learn Everything You Need to Know About Compensation Awards Under the IRS’s Whistleblower Program

Lynette Byrd
Attorney Lynette Byrd
IRS Whistleblower Award Team Lead
Former DOJ Attorneyenvelope iconContact Lynette
Nick Oberheiden
Attorney Nick Oberheiden
IRS Whistleblower Award Team Leadenvelope iconContact Nick
Tim Allen
Tim Allen
IRS Whistleblower Award Team
Former Secret Service (Digital Forensics Expert)
Brian Kuester
Attorney Brian Kuester
IRS Whistleblower Award Team
Former U.S. Attorney and District Attorneyenvelope iconContact Brian

The Internal Revenue Service (IRS) is one of a handful of federal agencies that pays compensation awards to whistleblowers. If you have information about tax fraud, tax evasion, or any other violation of the Internal Revenue Code, Bank Secrecy Act, Foreign Account Tax Compliance Act (FATCA), or any other statute or regulation falling within the IRS’s enforcement jurisdiction, you should speak with a lawyer about coming forward promptly.

At Oberheiden P.C., our lawyers represent IRS whistleblowers nationwide. If you are thinking about blowing the whistle and are interested in seeking an IRS whistleblower award, we can give you the advice and insights you need to make informed decisions as you move forward. If you decide to file a whistleblower complaint with the IRS, our lawyers can communicate with the IRS on your behalf, and we can work to secure any award to which you become entitled.

Tax Whistleblower Eligibility and Calculation of IRS Whistleblower Awards

The first step toward seeking an IRS whistleblower award is determining your eligibility to serve as a whistleblower. Generally, to be eligible to receive an award from the IRS, a whistleblower must meet four key requirements:

  • The whistleblower must provide information to the IRS voluntarily;
  • The whistleblower must be the “original source” of the information provided;
  • The information provided must reflect an amount in controversy (including taxes, penalties, and interest) in excess of $2 million; and,
  • The whistleblower must assist the IRS with conducting a successful enforcement action.

If you believe that you have information that is unknown to the IRS and are interested in coming forward, your first step is to complete IRS Form 211, Application for Award for Original Information. Along with IRS Form 211, you will be required to submit a detailed written explanation and supporting documentation that demonstrates “why you believe the act described constitutes a violation of the tax laws.” Due to the complexity of the tax whistleblower submission process—and the importance of ensuring that you clearly establish your eligibility for an IRS whistleblower award—it is strongly recommended that you work with experienced legal counsel.

If you submit a whistleblower complaint to the IRS and the IRS successfully pursues enforcement based on the information you provide, you will be entitled to an IRS whistleblower award equal to between 15 and 30 percent of the amount that the IRS recovers, provided that, “the IRS determines that the information [you] submitted . . . substantially contributed to an administrative or judicial action.” Our lawyers can assist with establishing your “substantial contribution,” and we can take additional steps to secure your award if necessary.

When determining what percentage to award a whistleblower, the IRS considers several factors. These include both “positive factors” that weigh in favor of the maximum award of 30 percent and “negative factors” that suggest a smaller award is warranted. The positive factors that can increase the amount of an IRS whistleblower award include:

  • Acting promptly to inform the IRS of noncompliance
  • Providing information about “an issue or transaction of a type previously unknown to the IRS”
  • Providing information that the IRS was unlikely to discover through the exercise of reasonable diligence
  • Providing details in a “clear and organized manner,” particularly if this helps to preserve IRS resources
  • Providing “exceptional cooperation and assistance” during the IRS’s investigation and enforcement efforts
  • Providing information about the subject taxpayer’s assets that can be used for collection, “particularly if the assets were not otherwise known to the IRS”
  • Identifying connections between transactions or parties, allowing the IRS “to understand tax implications that might not otherwise have been understood”
  • Causing the subject taxpayer to correct a previous improper position or take other rectifying action as a result of facing an IRS investigation

The negative factors that can decrease the amount of an IRS whistleblower award include:

  • Delaying in filing a whistleblower complaint with the IRS, “particularly if the delay adversely affected the IRS’s ability to pursue an action or issue”
  • Contributing to the underpayment or other noncompliance identified in IRS Form 211
  • Directly or indirectly profiting from the subject taxpayer’s underpayment or other noncompliance (provided that the whistleblower “did not plan and initiate the actions that led to the [violation]”)
  • Negatively affecting the IRS’s ability to pursue enforcement (i.e., by disclosing the IRS’s investigation)
  • Violating any instructions provided by the IRS
  • Violating any terms of a confidentiality agreement or other contract entered into with the IRS
  • Providing false or misleading information to the IRS, or otherwise violating the requirements of Section 7623(b)(6)(C) of the Internal Revenue Code (requiring submission of all information under penalty of perjury)

Put our highly experienced team on your side

Dr. Nick Oberheiden
Dr. Nick Oberheiden

Founder

Attorney-at-Law

Lynette S. Byrd
Lynette S. Byrd

Former DOJ Trial Attorney

Partner

Brian J. Kuester
Brian J. Kuester

Former U.S. Attorney

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

Local Counsel

Joe Brown
Joe Brown

Former U.S. Attorney

Local Counsel

John W. Sellers
John W. Sellers

Former Senior DOJ Trial Attorney

Linda Julin McNamara
Linda Julin McNamara

Federal Appeals Attorney

Aaron L. Wiley
Aaron L. Wiley

Former DOJ attorney

Local Counsel

Roger Bach
Roger Bach

Former Special Agent (DOJ)

Chris Quick
Chris J. Quick

Former Special Agent (FBI & IRS-CI)

Michael S. Koslow
Michael S. Koslow

Former Supervisory Special Agent (DOD-OIG)

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

Steps for Seeking an IRS Whistleblower Award

If you have information that the IRS may be able to use to pursue an enforcement action involving an amount in controversy of $2 million or more and are interested in seeking an IRS whistleblower award, there are some steps you should take promptly. These steps include (but are not limited to):

1. Preserve the Information You Have in Your Possession

You should do what you can to preserve the information you have in your possession. Keep all documents in a safe place, back up all electronic files, and take detailed notes.

2. Be Careful Not to Put Yourself At Risk

While it is important to preserve the information you have in your possession, it is also important not to put yourself at risk. For example, if you have information about tax law violations committed by your employer, you must be careful not to improperly copy or remove data from any employer-owned servers or devices. If you need advice, our lawyers can help.

3. Start Thinking About What You Need to Complete IRS Form 211

You should also start thinking about what you will need to complete IRS Form 211. You can review the form on the IRS’s website (using the link above) to determine if you will be able to fully complete the form or if additional information is required.

4. Speak with an IRS Whistleblower Lawyer

If you are thinking about blowing the whistle with the IRS, we strongly recommend that you speak with an IRS whistleblower lawyer. At Oberheiden P.C., we provide no out-of-pocket legal representation for whistleblowers, and you can speak with one of our senior lawyers in strict confidence.

5. Work with Your Lawyer to Make Informed Decisions About Your Next Steps

Working with your lawyer, you will want to make informed decisions about your next steps. This includes not only deciding whether you have sufficient information to file a whistleblower complaint with the IRS, but also deciding whether you are prepared to work with the IRS during its investigation in order to maximize your IRS whistleblower award (if you become eligible to receive one).

FAQs: Working with the IRS and Seeking a Whistleblower Award

How Do I Apply for a Whistleblower Award from the IRS?

Applying for a whistleblower award from the IRS starts with filing IRS Form 211. Practically, however, the process begins much earlier. Before you file IRS Form 211, it is critical to ensure that you can qualify as a tax whistleblower, and you will most likely want to work with a lawyer to assess your eligibility for an IRS whistleblower award as well.

How Common Are IRS Whistleblower Awards?

In the government’s 2022 fiscal year (the most recent year for which data are available), the IRS reported paying 132 whistleblower awards, with a total compensation amount of $37.8 million. This equates to a whistleblower award being issued approximately every three days.

What is the Average IRS Whistleblower Award?

Based on the IRS’s data for the 2022 fiscal year, the average IRS whistleblower award was $286,000. However, individual awards vary significantly and are determined based on the amount that a whistleblower helps the IRS recover.

Am I Guaranteed an Award if I File a Whistleblower Complaint with the IRS?

Filing a whistleblower complaint with the IRS does not guarantee that you will receive an award. To receive an award, you must ensure that you qualify as a tax whistleblower, and you must assist the IRS with pursuing a successful enforcement action involving an amount in controversy of $2 million or more.

Do I Need a Lawyer to Seek a Whistleblower Award from the IRS?

While hiring a lawyer to seek a whistleblower award from the IRS is not required, it is strongly recommended. At Oberheiden P.C., we have extensive experience representing federal whistleblowers, and our team includes former IRS Special Agents and white-collar prosecutors at the U.S. Department of Justice (DOJ).


Speak with a Senior IRS Whistleblower Lawyer at Oberheiden P.C.

If you would like to speak with a lawyer about seeking an IRS whistleblower award, we encourage you to schedule a complimentary initial consultation at Oberheiden P.C. We represent tax whistleblowers nationwide. To speak with a senior IRS whistleblower lawyer in strict confidence as soon as possible, please call 888-680-1745 or request an appointment online now.

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