FAQ
- What types of cases does Phillips & Cohen handle?
- Does Phillips & Cohen charge to evaluate a potential case or to represent whistleblowers?
- What is the process for getting a reward from the IRS?
- Who can get a reward?
- Does the whistleblower have to be a citizen of the U.S. to get a reward?
- Are whistleblowers eligible for a reward for all claims filed or just those over a certain amount?
- Why should I hire a lawyer?
- I think my former spouse is cheating on his taxes. Can Phillips & Cohen help me get a reward for that information?
- Where can I find the text for the new IRS whistleblower law?
- If I gave information to the IRS about specific instances of tax evasion but I didn’t file a whistleblower claim, can I still get a reward?
- Once I provide the information, how long will it be before the IRS pays me a reward?
- Does the IRS whistleblower law apply only to cases of tax fraud?
- Will anyone know I provided Phillips & Cohen or the IRS with information?
- Does the whistleblower law provide rewards for individuals who blow the whistle on foreign firms?
- Is there a statute of limitations on tax whistleblower cases?
-
What types of cases does Phillips & Cohen handle?
Phillips & Cohen specializes exclusively in representing whistleblowers in tax informant cases as well as qui tam lawsuits brought under the False Claims Act. In tax cases, the amount owed the government must exceed $2 million to qualify under the 2006 tax whistleblower law. Our lawyers have worked closely with the IRS Whistleblower Office from its start and are very familiar with its operations and procedures. We are the largest and most successful law firm that represents whistleblowers. Cases brought by the firm’s lawyers on behalf of whistleblowers have resulted in recoveries totaling more than $7 billion.
-
Does Phillips & Cohen charge to evaluate a potential case or to represent whistleblowers?
Phillips & Cohen evaluates potential cases for whistleblowers at no charge. The law firm represents whistleblowers in tax cases and qui tam (government contract fraud) cases on a contingency basis. This means that clients don’t pay Phillips & Cohen anything unless the client receives a reward.
-
What is the process for getting a reward from the IRS?
To receive a reward under the IRS whistleblower program enacted in 2006, the whistleblower must provide information about cases where taxes, penalties and interest total more than $2 million. In the case of an individual, the tax cheat’s annual income must exceed $200,000.
At Phillips & Cohen, we ask all individuals to fill out a form to provide us with detailed information about the tax matter so that we can evaluate a potential case to determine, based on our knowledge and experience, how strong the evidence is and whether it is likely the IRS would pursue the matter. The IRS investigates whistleblower cases only when it receives solid, credible information about taxes owed by individuals or businesses. The IRS doesn’t want educated guesses or speculation and is interested only in significant tax matters – not marital or business disputes.
Phillips & Cohen evaluates the whistleblower’s information and advises the whistleblower as to the merits of the potential case. If an agreement is reached to represent the whistleblower, the firm will assemble the evidence and prepare your submission in a convincing way to get the IRS interested in pursuing the case. The IRS gets lots of whistleblower tips; it’s important to present to the agency the strongest case possible so that the IRS will investigate.
The IRS pays rewards to whistleblowers only after the IRS actually collects the money that is owed. The whistleblower is eligible to receive up to 30 percent of the amount collected – which may not be the same as the amount that is owed – and can contest the reward amount in U.S. Tax Court.
-
The IRS pays rewards to individuals whose submissions include concrete information and evidence regarding taxes owed by an individual or an entity that leads to the recovery of more than $2 million, and who otherwise comply with program requirements. If smaller amounts of taxes are involved, a much smaller reward is possible under a separate, discretionary whistleblower reward program. Decisions about those rewards rest solely with the IRS and can’t be contested.
-
Does the whistleblower have to be a citizen of the U.S. to get a reward?
Foreign citizens are eligible for rewards under the new whistleblower program. In fact, they might have important information about multinational companies evading or underpaying taxes to the U.S. government.
-
Are whistleblowers eligible for a reward for all claims filed or just those over a certain amount?
To get a reward under the latest whistleblower program, taxes, penalties and interest owed must exceed $2 million. Under this program, IRS will reward whistleblowers with 15 percent to 30 percent of the amount the IRS actually collects – not the amount that is owed. If the company or individual taxpayer has no known assets and is unable to pay the IRS the taxes that are owed, the whistleblower won’t get a reward because the government collected no money. Whistleblowers get paid their rewards after the government is paid. If whistleblowers disagree with the reward amount, they may contest the IRS decision in U.S. Tax Court.
If the disputed taxes total less than $2 million, whistleblowers can file claims under the older whistleblower program. But the reward in those cases is entirely up to the discretion of the IRS. The agency may decide to reward the whistleblower with nothing or may give up to a maximum of 10 percent of the amount recovered. The whistleblower can’t dispute the IRS decision.
-
Whistleblowers generally want to do all they can to ensure they get a reward for their information and improve their chances for getting a bigger share of the recovered funds. Experienced, respected lawyers, such as those at Phillips & Cohen, can make a difference in that regard.
Being represented by an attorney is important before any information is given to the IRS. The IRS Whistleblower Office is flooded with whistleblower claims and can’t pursue all of them. Whistleblowers benefit when they have experienced counsel who can think through all of the angles of the whistleblowers’ information; shore up and perhaps expand on the allegations with additional analysis and evidence; and present in writing and in person the allegations and evidence in a persuasive and convincing manner to grab the attention of the IRS.
Hiring counsel who is a respected attorney and who has a good relationship with the IRS also can help focus attention on a whistleblower’s allegations. After the IRS has investigated the claims and recovered funds, it’s important to have a lawyer who has the resources to contest the reward given by the IRS if the circumstances call for it.
-
I think my former spouse is cheating on his taxes. Can Phillips & Cohen help me get a reward for that information?
Phillips & Cohen handles tax whistleblower cases under the recently created IRS whistleblower program, which accepts only cases where the taxes, penalties and interest exceed $2 million. Tax evasion or underpayment cases involving ex-spouses, neighbors and former business partners tend to involve smaller amounts and are covered by the older IRS informant law. Phillips & Cohen doesn’t handle those cases, except in extraordinary instances.
-
Where can I find the text for the new IRS whistleblower law?
See the IRS whistleblower law on our website for the wording of the relevant section in the Tax Relief and Health Care Act in 2006.
-
If I gave information to the IRS about specific instances of tax evasion but I didn’t file a whistleblower claim, can I still get a reward?
No. You must file a claim to be entitled to a reward. In addition, only claims filed after Congress enacted the Tax Relief and Health Care Act in December 2006 qualify under that program.
-
Once I provide the information, how long will it be before the IRS pays me a reward?
The law is so new that no whistleblower cases under the 2006 law have been completed. Given our experience with other types of whistleblower cases the government has investigated, we know that these cases can take years. Even after the IRS completes its investigation and calculates the taxes that are owed, taxpayers have a right to contest the IRS determination and often will do so.
-
Does the IRS whistleblower law apply only to cases of tax fraud?
Whistleblowers who know of instances involving tax evasion and tax underpayments – even if they are a result of simple mistakes – also may qualify for rewards under the IRS whistleblower law if the amount in dispute plus taxes and penalties total more than $2 million. See examples of tax schemes for common ways that companies and individuals cheat the government.
-
Will anyone know I provided Phillips & Cohen or the IRS with information?
Your submission is not part of a public record or filing and is made confidentially. The IRS protects the identity of whistleblowers to the fullest extent permitted by law.
-
Does the whistleblower law provide rewards for individuals who blow the whistle on foreign firms?
If the foreign companies are required to pay U.S. taxes and they don’t pay taxes as required, then whistleblowers who report them to the IRS through the whistleblower program are eligible for a reward.
-
Is there a statute of limitations on tax whistleblower cases?
Acting promptly to provide the IRS with information about a tax scheme is always in a whistleblower’s best interests as certain claims may have a short statute of limitations. The IRS also can deny a reward claim if it obtained the information from another source first.