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Tax Fraud Whistleblower

Tax Fraud Whistleblowers help bring tax evaders to justice

A whistleblower is a person who steps forward with information about those who attempt to directly or indirectly defraud the federal government.

Several U.S. Government departments and autonomous regulators like the Securities and Exchange Commission (SEC) pay out a percentage of the amount recovered by the government as a reward to the whistleblower. For example, the Internal Revenue Service (IRS) encourages a tax fraud whistleblower to come forward with original information by promising — depending on the nature of information — up to 30 percent of the additional tax, penalty, and other amounts it collects as a result of a successful claim.

If the government does not intervene and the whistleblower pursues the case alone or with their lawyer in what is called a qui tam lawsuit, they may collect up to 30 percent of the total recovery.

The False Claims Act

The federal Civil False Claims Act, or simply the False Claims Act, has an interesting history dating back to the Civil War. It was enacted by Congress in 1863 to curb fraud by war profiteers supplying the Union Army during the war.

However, since the Civil War days this has been used to curb all kinds of frauds against the federal government. It codifies qui tam writs, which date back to 13th century England. Qui tam is an abbreviation of a Latin phrase which translates roughly to “he who sues on behalf of the King, as well as for himself.”

Kinds of Tax Frauds

There are several ways unscrupulous individuals or companies commit tax fraud. Some of the more common types of tax fraud are:

  • Employment tax fraud: a business withholds taxes from its employees but intentionally fails to pay them to the IRS or treats an employee as an independent contractor.
  • Corporate tax fraud: under reporting of income or dividends
  • Money laundering tax fraud/offshore accounts fraud: tax evasion through expatriation and repatriation of monies

There are a number of dubious practices that can be flagged as being indicative of possible tax fraud:

  • Deliberately omitting income
  • Maintaining two sets of books
  • Failing to file a tax return
  • Overstating the amount of deductions
  • Unusual transfer of assets or income
  • Misusing trusts to evade tax

False Claims Act Lawyers

Whistleblower law in the U.S. has developed over the last 150 years, and today there are specialized False Claims Act lawyers who aid whistleblowers, including tax fraud whistleblowers, in bringing violators of the law to justice.

The law protects those who come forward to blow the whistle on a wrongdoer. However, it is essential that a whistleblower lawyer is involved in the process. A whistleblower lawyer could help a whistleblower follow through with a claim properly and protect the whistleblower from the blowback that might come as a result, including unfair dismissals or other consequences.

Sokolove Law has more than three decades of experience in fighting for the rights of ordinary Americans, including their rights as tax fraud whistleblowers. If you know of a tax fraud or any other kind of fraud being committed against the federal government, contact Sokolove Law today for a free and confidential consultation.

 

Tax Fraud Whistleblower was last modified: December 28th, 2016 by Sokolove Law