Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
IRS Considers Lowering Financial Incentives for Whistleblowers
Author: Scarinci Hollenbeck, LLC
Date: March 20, 2013
Key Contacts
Back
The Internal Revenue Service has encouraged Americans to help it detect and prosecute tax law violations by offering financial incentives for those who alert the agency to tax-related crimes. However, the agency is considering lowering these incentives in the future, which may affect how many people come forward.
Acting IRS commissioner Steven Miller recently proposed to shrink the existing provisions of the IRS Whistleblower program, and suggested a number of changes in regards to which types of money qualify for rewards. Under the existing program, those who alert the IRS to tax evasion can collect a reward that ranges between 15 and 30 percent of any proceeds brought in as a direct result of a tip. However, the tax evasion must involve at least $2 million in funds or apply to an individual making at least $200,000 per year, the New York Times reports.
Under the new proposals, whistleblowers would face difficulties obtaining rewards that stem from a corporation’s inflation of losses, the Times notes. In addition, informants would be wholly excluded from rewards related to money from Foreign Bank and Financial Accounts (FBARs) violations, the newspaper added.
However, many lawmakers say the proposal – if implemented – may deter Americans from coming forward with knowledge of tax violations. Further, many analysts noted that the IRS has failed to make good on several of the previous assistance they have received from informants. For example, the IRS has received more than 1,960 claims since 2006, but paid its first claim in 2011, the Times reports.
The IRS has not yet gone through with any of its proposals and has not yet announced when or if it will decide to pursue a stricter whistleblower policy. Currently, it has not let up on its efforts to use various resources to detect tax law violations, including new agreements with several countries across the globe for more transparency and reporting on Americans’ foreign accounts.
- Practices: Tax and Trusts & Estates
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Buying Commercial Property in New Jersey: Legal Guide for Small Businesses
Small businesses considering buying commercial property in New Jersey must evaluate a range of legal, financial, and operational factors. While ownership can offer long-term value and control, it also introduces significant risks if not properly structured. This guide outlines key considerations to help New Jersey business owners make informed decisions, minimize legal exposure, and successfully […]
Author: Robert L. Baker, Jr.
The SEC’s Latest Guidance on Applying Federal Securities Laws to Tokenized Securities
On January 28, 2026, staff of the U.S. Securities and Exchange Commission’s Divisions of Corporation Finance, Investment Management, and Trading and Markets issued a joint statement clarifying how existing federal securities laws apply to tokenized securities. The SEC’s “Statement on Tokenized Securities” does not establish new law, but it does provide greater clarity on the […]
Author: Dan Brecher
Common Legal Mistakes NYC and New Jersey Business Owners Make
Operating a business in the New Jersey and New York City metropolitan region offers incredible opportunities, but it also requires navigating a dense and highly regulated legal environment. From entity formation to regulatory compliance, seemingly minor legal oversights can expose business owners to significant risk. In our work with businesses throughout the region, our attorneys […]
Author: Dan Brecher
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.