IRS Whistleblower Program Improvement Act of 2023

IRS Whistleblower Program Improvement Act of 2023

This bill modifies provisions of the Internal Revenue Code relating to whistleblower protections. Specifically, the bill

• revises the standard for review of whistleblower awards in the Tax Court to require a de novo review standard (currently, the standard is abuse of discretion);
• exempts whistleblower awards from reductions due to budget sequestration;
• allows whistleblowers anonymity in proceedings before the Tax Court;
• modifies the Internal Revenue Service (IRS) whistleblower report to require inclusion of a list and description of the top 10 tax avoidance schemes disclosed by whistleblowers;
• requires the IRS to pay interest on whistleblower awards if not paid within one year of receipt of proceeds collected from whistleblower disclosures; and
• allows payment of the attorney fees of whistleblowers regardless of whether the whistleblower award was paid through the mandatory or the discretionary whistleblower award program.

The IRS Whistleblower Program Improvement Act of 2023, also known as Bill 118 hr 1300, is a piece of legislation aimed at enhancing the effectiveness of the Internal Revenue Service's whistleblower program. The bill seeks to incentivize individuals to report tax fraud and other violations by providing them with financial rewards for their information.

One key provision of the bill is the increase in the maximum award that whistleblowers can receive for reporting tax underpayments or violations. Under the current law, whistleblowers can receive up to 30% of the collected proceeds resulting from their information. The IRS Whistleblower Program Improvement Act of 2023 proposes to raise this maximum award to 40%, in order to encourage more individuals to come forward with valuable information.

Additionally, the bill includes measures to streamline the process for whistleblowers to submit their claims and receive their awards. This includes establishing clear guidelines for the IRS to follow when evaluating whistleblower claims, as well as providing protections for whistleblowers against retaliation from their employers. Overall, the IRS Whistleblower Program Improvement Act of 2023 aims to strengthen the IRS's ability to detect and address tax fraud, while also providing greater incentives and protections for individuals who choose to report such violations. The bill is currently under consideration in Congress and has garnered bipartisan support for its efforts to improve the effectiveness of the whistleblower program.