Paralysis of the IRS Whistleblower Program

The Tucson Sentinel reports that despite Congressional expansion of the IRS whistleblower program in 2006, the program does not live up to its expectations.  In the four years since Congress passed the new program, only one whistleblower has purportedly collected an award—an accountant who collected $4.5 million for reporting a $20 million tax underpayment.  In the meantime, the IRS continues its practice of refusing to communicate with whistleblowers concerning  the status of investigations, and the investigations themselves seem to be excessively long.

The US Government Accountability Office and the IRS Inspector General are currently auditing the program to determine its efficacy.  Senator Charles Grassley, the champion of the whistleblower program remains concerned about paralysis in the program due to the IRS’s concerns about taxpayer privacy.  There also seems to be dissension in the ranks of the IRS concerning the desirability of the whistleblower program.  Attorneys for whistleblowers credit the IRS program; but place blame for the impediments with the IRS chief counsel, who has erected significant roadblocks.  Some of these attorneys believe that the secrecy and slowness of the claims process has deterred viable whistleblowers from coming forward with tips.

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