Law Commons^™

Whistleblowers And Tax Enforcement: Using Inside Information To Close The "Tax Gap", Edward A. Morse

Edward A. Morse

This article examines the current legal structure allowing rewards for informants who assist the IRS in the enforcement of the tax laws. IRS data suggest that informants are a cost-effective means of enhancing tax enforcement. The Tax Relief and Health Care Act of 2006 introduced a separate whistleblower award program that enhances reward levels (up to 30 percent of the amount collected) and attempts to provide greater certainty in the payment of such rewards, including a process for enforcing reward claims through litigation in the Tax Court. Although whistleblower awards enhance tax enforcement, the current reward provisions raise significant issues …