The IRS Whistle Blower ProgramThe IRS whistle blower program was re-worked in 2006. After the Internal Revenue Service faced new criticism, they decided to revamp the program by rewarding people who provide them with information on tax-cheating cases. The new IRS whistle blower program is already making an impact as so far, it has brought in $340.3 million in just the past five years, according to a report released by the Treasury Inspector General for Tax Administration. According to government officials, the most common IRS whistle blowers are the so called "X-es" - ex-girlfriends and boyfriends, ex-spouses and ex- business associates. The most reliable IRS whistle blowers are accountants, bookkeepers, basically people that have access to documented evidences such as a business's financial records. But fact is that the reputation of an IRS whistle blower is not high and the new program has a bad image as some people claim it's nothing more than "rewards for rats." A lot of people criticize the new IRS whistleblower program expressing fears that unhappy neighbours or anyone who has a score to settle might use it to make the URS harass them. If we have to dig and try to understand the psychology of an IRS whistle blower, we will find out that these people certainly aren't Mother Teresa and they are driven by something more than just respect for the law and righteousness. As mentioned, the most common motive is payback. That's why the ex-s are the main informants in such cases. Jeff A. Schnepper who is a ax lawyer in Cherry Hill, N.J., and author of several books on taxes and finance says that the revenge is the biggest motivator for any IRS whistle blower. In one of his books, Mr. Schnepper tells about one woman who was married to a doctor who didn't report all of his cash income from patients. The couple got divorced, she reported him to the IRS several years ago - and eventually received "a substantial reward," says Mr. Schnepper. It's evident that the new IRS whistleblower program makes the motives for whistleblowers less than pure. In the past years, the amount of the average payout has been on the rise. Just for 2005, IRS handed out 169 rewards totaling $7.6 million to informants, which is a 66 percent increase from nearly $4.6 million the prior year. Over the past six years, the average reward has been nearly $24,000. So, it's needless to say that being an IRS whistle blower is quite lucrative, but keep in mind that there is some serious waiting involved when it comes to getting the reward. In cases analyzed by Treasury investigators, informants waited an average of more than 7 1/2 years to be paid. The delays comes from a law stating that rewards are paid only once money has been collected from the taxpayers found guilty. The laws for IRS whistle blower are the same no matter the state. So regardless if you are in maryland,colorado, or Texas, it's the same law. But in Canada, the situation is different. You don't need software training to file your report, Labor law posters for your business's compliance needs. |