Spectacular news! As of August 3, 2016, The United States Tax Court finally made a decision on how to rule on criminal money going to whistleblowers and they ruled in the tax whistleblowers favor! That is a great step in the right direction. So many large corporations are NOT paying their fair share of taxes and employees who try to expose fraud (like pretty much anyone in the bookkeeping department, financial services or a high level executive who decides to check) are usually fired. These employees who were punished for doing the right thing then come to our office to complain and work with government prosecutors to investigate the TAX FRAUD. Yes, they actually work with the investigators to determine how the fraud happens and how to stop it! When the IRS finally goes in and gets the data, they OFTEN FIND the fraud is GREATER than our whistleblower ever imagined! Next, the tax cheat’s case goes from being a “collection action” into a “criminal action”. The fines and penalties are very heavy and the government has to prosecute these tax cheats.
What happens when the government collects millions, sometimes HUNDREDS of MILLIONS of dollars in CRIMINAL fines and penalties, but a smaller amount in actual recovered tax dollars? Prior to August 3, 2016, the whistleblower was NOT entitled to any share of those huge fines and penalties. NOT ANY LONGER! Prior to the decision, the Department of Treasury severely limited the “collected proceeds” which could be awarded to a whistleblower. In this case, there were actually 2 separate ANONYMOUS whistleblowers (yes, you get to stay anonymous) who were referenced by their numbers: 21276-13W & 21277-13W. These whistleblowers did not just get just a small portion of the collected taxes, they also got an award of $17,791,607.00 based on the $54 million the government collected in criminal fines and forfeitures! The IRS did not want to give the whistleblowers that money, but the court said YES. You must REWARD WHISTLEBLOWERS for doing the RIGHT THING and that means they are given a share of EVERYTHING the government collects.
TAX WHISTLEBLOWERS are a fantastic part of the LaBovick Law Group practice. Our practice would not exist without the work of our National Whistleblowing organization in Washington DC. They work so hard to lobby congress on tax issues and work to make sure whistleblowers are treated fairly. Thanks to Stephen Kohn, for all his hard work on this and all other Qui Tam/Whistleblower cases. In this case, they filed extensive briefs with the IRS to urge them to reward whistleblowers who expose criminal and fraudulent tax avoidance schemes.
This battle will, for the moment, save our International Tax Fraud Whistleblower practice. It will give teeth to whistleblower rights when uncovering criminal activity. However, this is not over. The Treasury Dept. can always appeal the Tax Court’s ruling. This really is a quantum shift away from what the government wanted and it would be surprising if they do not try and appeal.
At this time, American billionaires store a lot of money off shore. That money is supposed to be taxed every year on the money it earns. The estimated value of off shore money is $3 TRILLION DOLLARS! The annual interest on that money is literally tens and maybe hundreds of billions of dollars.
If you find out about any fraudulent tax scheme AND it is related to a business which does over $2 million dollars in annual income and the fraud is for at least $1 million dollars contact us for attorneys that specialize in whistleblowing cases. We have forensic accounting & ex-Federal Prosecutors waiting to help our Whistleblower clients.