Wisconsin residents may know that whistleblower protection laws are in place to encourage individuals to come forward and report malfeasance by their employers by protecting them from retaliation. However, they may not be aware that these protections do not generally apply when the wrongdoing being reported is tax underpayment or tax fraud.
The Internal Revenue Service has a whistleblower program in place, and a report is sent to Congress each year containing a summary of the program’s activities along with regulatory and legislative recommendations. The IRS pointed out in its most recent report that those reporting tax fraud sometimes face losing their jobs or even physical harm, and they urged lawmakers to strengthen the legal protections available to them. The report for the fiscal year ending Sept. 30, 2015 was sent to Congress on Feb. 10.
In certain situations, tax fraud whistleblowers may qualify for protection under laws including the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act and the Sarbanes-Oxley Act of 2002. Those who report tax violations may also qualify for a reward of up to 30 percent of the taxes, penalties and other monies collected by the IRS as a result of their information.
Those who witness wrongdoing in thew workplace and those who face discrimination and harassment while at work are sometimes fear that little will be achieved by stepping forward. Attorneys could explain the retaliation protections that are afforded workers by federal law, and they may describe the procedures that are involved in pursuing a claim.
Source: The Internal Revenue Service, “Whistleblower – Informant Award”, Feb. 10, 2016