IRS Tax Fraud

The Internal Revenue Service (IRS) contains a Criminal Investigation office that serves as the main line of defense against fraud and corruption. While this office is proficient at detecting instances of fraud, some individuals and organizations can navigate around their regulations to avoid paying taxes, earn a more substantial tax credit, or place themselves into a different tax bracket that would require them to pay fewer income taxes. The criminals behind the fraud often conceal their wrongdoing behind closed doors, but with the help of a whistleblower, their crimes can come to light, and they’ll be held accountable for stealing taxpayer dollars away from the people who need it most.

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IRS Tax Fraud

Although paying your taxes isn’t the most fulfilling thing to do, it allows the federal government to use your tax dollars for programs that can be used for good, such as a new education program that helps at-risk youth further their schooling. Under section 7623 of the IRS’s legislative code, the agency is allowed to issue awards to whistleblowers if they bring forward information that helps to recover sizable amounts of taxpayer dollars. The specific amount of the award will depend on the circumstances of your case, but whistleblowers can expect to recover anywhere between 15% - 30% of the total amount recovered by the government.

If you have knowledge of an individual or organization committing IRS tax fraud, contact us today for more information on how to use your evidence for the greater good.

Stand Tall Against All IRS Tax Fraud

Tax fraud can look differently depending on the individual or organization who’s committing the crime, but here are a few common examples:

False Returns

A false return occurs when an individual or organization intentionally and knowingly falsified their tax documents. This is usually done to reduce tax bills or inflate tax refunds, but no one is allowed to profit from a relationship with the federal government fraudulently.

Failure to Report Income

Misrepresenting income is one of the most prevalent forms of tax fraud. This occurs when a taxpayer purposefully omits income sources, such as offshore accounts and job income, or willingly under-reports their income. There have been cases where someone makes an honest mistake while reporting their income, but these situations are considered negligence rather than tax fraud. 

False Deductions or Credits

Taxpayers can reduce the taxes they pay by claiming deductions or credits. Unfortunately, some people attempt to take advantage of this system by fraudulently claiming these deductions. For example, an unethical taxpayer might claim that they made a large charitable donation to qualify for credit when they never made the donation in the first place, or they might overstate their home office deductions to avoid paying taxes on the equipment. 

False Deductions or Credits

 The IRS requires all taxpayers to file a tax return by April 15th of every year, with limited exceptions. If an individual makes more than the IRS minimum requirement to file a return and fails to do so, they could be subject to fines and penalties for tax fraud. 

Not All Fraud Is Created Equal

Any evidence of tax fraud should be reported to the proper authorities, but the IRS is particularly interested in two types of fraud:

  • Fraud committed by an organization for which the disputed amount exceeds $2 million; and
  • Tax fraud committed by those whose gross income exceeds $200,000 per year and the disputed amount is over $2 million

Information Is Power

If you’re deciding whether to come forward with your evidence of fraud, the IRS offers various helpful resources for potential whistleblowers, such as:

  • Whistleblower Office Annual Reports
  • Information About the Whistleblower Informant Award
  • Guidelines on How to Report Suspected Tax Fraud
  • The Year’s “Dirty Dozen” List of Tax Scams

Our Complex Litigation Group serves as an ally to whistleblowers anywhere who seek to expose fraud and corruption. Our team works alongside former FBI investigators who can use their years of experience to establish a solid foundation for your case, one that will give us the best possible chance at future success.

Advocating for the Rights of Whistleblowers Anywhere

The IRS is fighting an uphill battle against tax fraud, and they need your help. 

Specific filing requirements and shifting deadlines can make it difficult for someone to transition from having evidence of fraud to becoming an actual whistleblower. Our Whistleblower Group understands all the nuances of being a whistleblower because one of our attorneys, Clark Bolton, served as a successful whistleblower himself in a case to expose healthcare fraud. Now, he uses his unique experience to finely tune each case to have the best possible chance of success, giving us an undeniable advantage in pursuing these types of cases. 

You need a firm that won’t quit when the going gets tough. Fortunately, our team is no stranger to complex and challenging cases, and we’ve recovered multi-million-dollar settlements in cases. If you have evidence of an individual or organization committing tax fraud, contact us today for more information on your next best step.