EXPOSING WRONGDOERS

Tax Fraud

This could be the most difficult or important decision of your career or, indeed, your life; the team at Pelton Graham is here to help you.

Because wrongdoers take steps to hide their activities, whistleblowers play an important role in the fight against corruption. This is especially true of “insiders” who have access to information that is not widely available. One example is with regard to employees who know or suspect that their employer is not paying the correct taxes.

Income tax return form with espresso cup, calculator, glasses and pen on table

The IRS Whistleblower Office Pays Money for Information

The IRS Whistleblower Office pays money to people who blow the whistle on persons who fail to pay the tax that they owe, and in 2019 paid whistleblowers over $120 million. If the IRS uses the information provided by the whistleblower, it can award the whistleblower up to 30% of what it collects.

Tax fraud includes:

False exemptions or deductions
Kickbacks
False or altered documents
Failure to pay tax
Unreported income
Organized crime financing/money laundering
Failure to withhold taxes
Any other failure to follow the federal, state, and local tax laws

Man using calculator and calculate bills in home office

Other Types of Tax Fraud

Abusive tax promotion or avoidance schemes

Fraudulent activity or an abusive tax scheme by a tax return preparer

Tax return preparer filed or altered your return without your consent

Misconduct or wrongdoing by a tax exempt organization or employee plan

Specific information, provided in a timely manner, increases the likelihood of a recovery and the rapid cessation of the objectionable conduct.

Retaliation

Retaliation is an all-too-common result of whistleblowing, despite numerous laws designed to prevent it. If you are retaliated against for blowing the whistle on tax fraud, you can be reinstated, get damages, back pay, attorney’s fees, Pelton Graham are experienced retaliation lawyers and will fight to protect your rights.

The Key to a Successful Whistleblower Tax Action

The key to a successful whistleblower tax action is convincing the government to join the case. For this reason, whistleblowers are strongly encouraged to retain an attorney to assist with their claim. Attorneys gather the important information, tell the story of the activity causing injury, submit information to the correct agencies, and negotiate with government attorneys. In addition, some agencies can only guarantee anonymity to the whistleblower if he or she has an attorney.

When and what to report—and to whom—are primary considerations for employees looking to report potential tax non-compliance at their company. Whistleblower laws are a state and federal patchwork, some dating back to the Civil War era, and solid legal advice is needed to determine the most favorable path through the maze.