Aware of possible tax fraud?
Examples of Tax Fraud
If you report income tax fraud or tax evasion, you may be entitled to a whistleblower reward, as outlined in this website.
Modeled on the Department of Justice (DOJ) program, the Internal Revenue Service (IRS) income tax reward program targets tax cheats and rewards whistleblowers between 15% and 30% of the amount recovered from unpaid taxes.
While much of the IRS reward program is very similar to the DOJ program, there are some significant differences, including:
- To collect a reward through the new IRS reward program, the underpaid taxes must total $2 million, but our threshold is $5 million (which equates to $17 million in undisclosed income or overstated expenses).
- The IRS keeps the whistleblower’s identity confidential.
- The IRS waits to pay rewards until after it collects all amounts owed in the case, and the matter officially is closed.
Examples of IRS Tax Fraud
Companies and individuals cheat on taxes in countless ways. A few examples of tax fraud where rewards are available include:
- Shifting profits overseas: Schemes include concealing ownership of patents, and transferring ownership of logos, manufacturing processes and other intangible property rights.
- Financial transaction fraud: Examples include balance sheet fraud, hiding assets offshore or overseas and keeping multiple sets of books.
- Improper employee classification: Some companies improperly classify employees as independent contractors to avoid paying taxes.
- Other: Other tactics used to avoid paying taxes include putting assets in another person or company’s name, paying cash to avoid records of income, claiming bogus deductions and much more.
If you know of income tax fraud or tax evasion and are interested in a whistleblower reward under the IRS reward program, fill out our fraud questionnaire.