Summary. These regulations provide comprehensive guidance for the award program authorized under Internal Revenue Code (Code) section 7623. The regulations provide guidance on:
- Submitting information regarding underpayments of tax or violations of the internal revenue laws and filing claims for award,
- The administrative proceedings applicable to claims for award under section 7623.
- The regulations also provide guidance on the determination and payment of awards, and provide definitions of key terms used in section 7623.
- Finally, the regulations confirm that the Director, officers, and employees of the Whistle blower Office are authorized to disclose return information to the extent necessary to conduct whistle blower administrative proceedings.
The regulations provide needed guidance to the general public as well as officers and employees of the IRS who review claims under section 7623.
To supplement these Regs, the Whistleblower Office Published Two New Fact Sheets to guide Whistleblowers on how to make a claim:
Publication 5232, The Whistleblower Claim Process, provides guidance to potential claimants on how to properly file the Form 211, Application for Award for Original Information.
Publication 5232-A, What Happens to a Whistleblower Claim for Award, describes the steps in the whistleblower claim process after filing a Form 211.
Filing a claim. In large part, the final regs track the previously issued guidance in the existing regs, Notice 2008-4, 2008-1 CB 253, and the Internal Revenue Manual, including the general information that individuals should submit to claim awards and the descriptions of the type of specific and credible information on taxpayers that should be submitted.
An individual submitting a claim should identify a person and describe and document the facts supporting the claimant's belief that the person owes taxes or violated the tax laws. The regs also reaffirm IRS's practice of safeguarding the identity of individuals who submit information under Code Sec. 7623 whenever possible. (Reg. § 301.7623-1)
The final regs include eligibility requirements for filing claims for awards and a list of ineligible claimants. In finalizing the regs, IRS has removed State and local government employees and members of a Federal or State body or commission from the categories of ineligible whistle blowers.
The final regs require individuals to file a formal claim for award, Form 211, Application for Award for Original Information. The regs allow IRS to specify an alternative submission method (such as electronic claim filing) pursuant to additional guidance.
Under the final regs, in cases in which the Whistleblower Office recommends payment of an award under Code Sec. 7623(a), the whistleblower administrative proceeding begins when the Whistleblower Office send a preliminary award recommendation letter to the claimant. The claimant has 30 days to respond with comments. This period may be extended at the sole discretion of the Whistleblower Office. (Reg. § 301.7623-3(b)(1)).
Disclosure. The final regs also confirm that the Director, officers, and employees of the Reg. § 301.6103(h)(4)-1(b)).
Whistleblower Office are authorized to disclose return information to the extent necessary to conduct whistle blower administrative proceedings.
Effective date. Reg. § 301.7623-1, Reg. § 301.7623-2, Reg. § 301.7623-3, and Reg. § 301.6103(h)(4)-1 apply to information submitted on or after Aug. 12, 2014, and to claims for award under Code Sec. 7623(a) and Code Sec. 7623(b) that are open as of Aug. 12, 2014. Reg. § 301.7623-4 applies to information submitted on or after Aug. 12, 2014, and to claims for award under Code Sec. 7623(b) that are open as of Aug. 12, 2014.
Time Frame. It can take from five to seven years, or more, for the IRS Whistleblower Office to make a decision about whether to pay an informant for information about individuals or businesses that don't pay all of the tax they owe.
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