The document provides an overview of the US tax whistleblower program. It discusses that the estimated US tax gap is $450 billion per year and awards are based on collected tax proceeds between 15-30%. It also summarizes statistics on claims received, awards paid, and amounts collected in recent years. The document outlines the process for filing a claim, opportunities for administrative and judicial appeal, and guidance available. It notes other considerations like confidentiality and potential criminal implications. Finally, it provides recommendations for tax whistleblower attorneys.

1. Tax
Whistleblower
Program
By
Thomas C. Pliske
tpliske@twlfusa.com
Tax Whistleblower Law Firm, LLC

2. TWB Program
1. General Information.
2. Nuts and Bolts of I.R.C. § 7623(b).
3. Appellate Process.
4. Guidance to IRS Whistleblower Program.
5. Other Things to Consider.
6. Best Business Practice.

3. TWB Program – General Info
1. General Information
a. Tax Gap – Estimated to be $450 Billion per
year.
b. Does not have to be Tax “Fraud”….any
tax underpayment will do.
c. Not qui tam-IRS will or will not do it alone.
d. Statistics of IRS Whistleblower Claims.

4. TWB Program - Statistics
2010 2011 2012 2013 2014
Awards
Paid
97 97 128 122 101
Collection
over $2
Million
9 4 12 6 9
Total
amount of
Awards
$18,746,327 $8,008,430 $125,355,799 $53,054,302 $52,281,628
Amount
Collected
$464,695,459 $48,047,500 $592,498,294 $367,042,420 $309,990,568
Table 1 - Amounts Collected and Awards Paid under I.R.C. § 7623

5. TWB Program - Statistics
Pre-
2010
2010 2011 2012 2013 2014 Total
Total
Claims
Received
11,794 13,220 8,166 9,493 10,520 14,365 67,558
Claims
Open
5,125 6,211 2,016 3,017 5,101 8,682 30,152
Table 2 - All Claims Received, By Fiscal Year of Receipt

6. TWB Program - Statistics
Table 3 - Reasons for Fiscal Year 2014 Closures, All Claims
Fiscal Year of Claim Receipt
Reason Pre-
2007
2007 2008 2009 2010 2011 2012 2013 2014 Total
Award Paid in
Full in 2014 59 9 18 33 27 89 3 -- -- 238
Allegations
Unclear/Non-
Specific
1 -- 2 8 1 3 33 276 190 514
Issues below
Threshold
-- 1 1 2 2 6 38 237 375 662
Info Already
Known
1 1 74 6 2 10 8 167 2 271
Lack of
Resources
-- -- -- 3 7 14 10 40 4 78
Exam Results –
“No Change”
11 -- 8 17 34 27 19 8 -- 124
No Collected
Proceeds
-- 1 21 6 3 7 19 -- -- 57
No Tax Issue 36 -- 1 13 6 5 4 11 2 78
SOL-Not
enough time
-- -- 2 6 9 13 42 46 13 131
SOL Expired -- -- 1 3 4 20 21 50 64 163
Closed – Other 3 2 13 33 37 189 116 423 804 1,620
Total 112 15 142 146 165 405 350 2,196 2,989 6,520

7. TWB Program - Nuts and Bolts of
I.R.C. § 7623(b)…..
2. Nuts and Bolts of I.R.C. § 7623(b)
…..Not I.R.C. § 7623(a)
a. Qualification of Claim.
• $2,000,000 amount in dispute.
• $200,000 in annual income if taxpayer is an
individual.
b. Filing a Claim (Form 211)
c. Award is between 15%-30% of collected
proceeds….no cap!
d. Debriefing.

8. TWB Program

9. TWB Program- Appellate Process
3. Appellate Process
a. Administrative Appeal.
Preliminary Determination Letter.
* WB can waive appeal or appeal.
* Must be done within 30 days of letter.
b. Judicial Appeal…US Tax Court.
Final Determination Letter
* Must petition the U.S. Tax Court within 30
days.

10. TWB Program-USTC
• Recent Court Decisions Worthy of Discussions
o Kasper v. Commissioner (Kasper 2) (October 8, 2015)
o Whistleblower One 10683-13w, Whistleblower Two 10683-13w, and
o Whistleblower Three 10683-13w v. Commissioner (September 16, 2015)
o Whistleblower 21276-13w, and Whistleblower 21277-13w v. Commissioner (June
2, 2015)
o Lippolis v Commissioner. T.C. Memo No. 20 (November 20, 2014)
o Comparini v. Commissioner, 143 T.C. No. 14 (October 2, 2014)

11. TWB Program- Litigation
Tax Whistleblower Litigation
Step #1 - Filing suit
• Initiation of the Whistleblower’s Suit
• Cover Letter (Exhibit 1)
• Petition – (Exhibit 2) must be filed within 30 days of Final Determination Letter
• Place of Trial – (Exhibit 3)
• Statement Of Taxpayer Identification Number – (Exhibit 4)
Step #2 - Tax Court Discovery Process
• Joint Motion for Protective Order and Proposed Order(Exhibit 5)
• Informal Discovery (Exhibit 6)
• Formal Discovery
o Interrogatories
o Requests for Production of Documents
o Requests for Admissions
• File Motion to Compel (Exhibit 7)
• File a Motion for Sanctions

12. TWB Program-Written Guidance
4. Guidance to IRS Whistleblower
Program
a. I.R.C. § 7623
b. Treasury Regulations
c. I.R.M. 25.2.2 Whistleblower Awards
d. Tax Court Cases
e. Miscellaneous Notices

13. TWB Program-Other
5. Other Things to Consider
a. Confidentiality
i. IRS will protect to extent legally possible.
ii. May disclose under certain circumstances.
iii. Will disclose to WB in such cases.
b. Criminal Implications
i. If WB “planned & initiated”- reduced award.
ii. Convicted of “planning and initiating” – no award.
iii. No immunity promised to WB
o aiding and abetting.
o conspiracy.

14. TWB Program-Other
5. Other Things to Consider
c. Tainted Information
1. Privileged
2. Stolen
3. Non-Disclosure Agreements
4. Fiduciary Duty
d. Whistleblower Must be Tax Compliant
• filing returns and paying taxes

15. TWB Program- Best Business
Practice
6. Recommendations to the “new” Tax Whistleblower
Attorney (BBP)
a. Know the underlying tax issue backwards and forwards.
b. Be familiar with other IRC sections and IRS procedures
• statute of limitations…3 years, 6 years, suspended.
• penalties
• etc.
c. Do not put the filed Tax Whistleblower Claim in a drawer for 7 years.
• Supplement Claim with new “material” and “relevant” facts.
• Supplement Claim with the Law and legal analysis as it develops to
better the Claim. (i.e. a positive factor).

16. TWB Program- Best Business
Practice
6. Recommendations to the “new” Tax Whistleblower
Attorney (BBP)
d. Attend the Taint/ Debriefing Conferences in
person with the IRS and client.
* Prepare the client for the conference.
e. Do not give client false hopes….this is a long process with
statistics showing little chance of success.
f. Be ready to litigate in the U.S. Tax Court.