The IRS Whistleblower Office released it FY 2018 Report to Congress today.  The report comes out one year after Congress amended section 7623 in the Bipartisan Budget Act of 2018, which clarified the definition of proceeds includes non-Title 26 amounts such as criminal fines, civil forfeitures, and violations of reporting requirements.  This change in the statute has clearly transformed the program, increasing the total amount of awards paid in FY 2018 to more than nine times what was paid in FY 2017.

The Whistleblower Office attributes this increase in the amount of awards to the change in the statute.  Under this new definition of proceeds, the Whistleblower Office reports that the proceeds collected for FY 2018 was $1,441,255,859, of which $809,915,922 is attributable to non-Title 26 amounts collected for criminal fines, civil forfeitures, and violations of reporting requirements.  Under the law prior to the addition of section 7623(c), the $809,915,922 of proceeds would not have been counted as proceeds, and the whistleblowers who provided information relating to these collections would not have received credit for these amounts when their awards were calculated.

Also notable is the increase in the average days to process awards claims.  The amount of time for claims under both subsections (a) and (b) has increased.  For claims under subsection (b), the time increased to 9.32 years in FY 2018 from 7.32 years in FY 2017.  This increase in not surprising, particularly when coupled with the large increase in awards, because large complex tax cases take longer to process and the change in law has likely resulted in old cases getting an award.

Finally, while it might take the better part of a decade on average to receive an award, the whistleblowers who overcome the hurdles of their information being considered to be speculative, not specific, or not credible, being below the threshold for IRS action, and properly filing a Form 211; the chances of receiving an award is 16 percent.  This is because the most common reason for the closure of a claim continues to be that the allegations made in the claim are not specific, credible, or are speculative in nature.  The percentage of claims closed for this reason in FY 2018 was 64%, up from 57% in FY 2017.

We are looking forward to an equally exciting and productive FY 2019.

Today the IRS Whistleblower Office released a 3-page overview of the tax whistleblower process called Publication 5251 – The Whistleblower Claim Process.  The new publication purports to provide clarity on:

  • What qualifies for an award
  • How whistleblowers submit a claim for award
  • What happens to a claim after the IRS receives it
  • Communicating with the IRS after a claim is submitted
  • Whistleblower Process Timeline
  • Common reasons for Initial rejection/denial of claim

While there are no new procedural changes identified in the overview, this publication does provide a snapshot of the claims process for the uninitiated.  In particular, the Process Timeline” flow chart on page 3 is a relatively realistic display of the timelines involved with the claims process.  Of course, we could cite numerous, and I mean numerous with a capital N, exceptions to the timeline based on the cases we have seen and been involved with[1], this is still a good representation of how the claims process SHOULD work.  Getting a claim through the system without snags is another story, and is something we work on every day.  A copy of Publication 5251 can also be found on


[1] For example, in theory the timeline shows the “Administrative Proceeding” starting at the time a payment is made but well before the IRS starts to wait simply for the period of limitations on refunds to expire before paying an award.  In practice this has not been happening.  This is particularly crucial because it is only the start of this Administrative Proceeding which would trigger the exception to the taxpayer rules of 6103(h)(4).

The Tax Court’s opinion in Whistleblower 21276-13W v. Commissioner, 147 T.C. No. 4 (2016), was a clear and decisive win for whistleblowers.  The IRS has long been improperly trying to limit what should be included in “collected proceeds” and today’s opinion restores Congress’s intention that all proceeds that are collected be included in the amount on which the whistleblower’s award is computed.  By specifically including criminal fines and forfeitures in the collected proceeds amount, this court decision means that a whistleblowers’ award will reflect the full amount that the government collected based on their information.  In this opinion, the Tax Court examined the definition of “collected proceeds” as used in section 7623(b)(1).  The court found that the language of that

Section 7623(b)(1) is straightforward and written in expansive terms, namely, where, using information provided by the whistleblower, the Secretary proceeds with an administrative or judicial action regarding underpayments of tax or any action regarding the violation or, or conniving to violate, the internal revenue laws, the whistleblower is entitled to an award based on a percentage of the collected proceeds resulting from the Secretary’s action (as well as any related actions) or from any settlement in response to such action.

The court refused to follow Respondent’s request to narrow the definition of collected proceeds.  The court stated:

We are leery of arbitrarily limiting the meaning of an expansive and general term such as “collected proceeds”. In drafting section 7623(b)(1), Congress could have provided that the whistleblower’s award is to based on taxes and other amounts assessed and collected by the IRS under title 26. But it did not.

The court explained that this case is not in conflict with Whistleblower 22716-13W v. Commissioner, which had ruled that FBAR penalties were not to be included in the $2 million threshold amount used to determine if section 7623(b) applied.  The court here stated that:

In reaching our holding today, we determined that the wording in the threshold requirement of section 7623(b)(5)(B) … is different from that of section 7623(b)(1), which provides for an award of a percentage of the collected proceeds …

The Tax Court held that the phrase “collected proceeds” is sweeping in scope and is not limited to amounts assessed and collected under Title 26 of the United States Code.  The Tax Court goes on to hold that criminal fines under Title 18 as well as civil forfeitures under Title 31 are both collected proceeds under section 7623(b)(1).

Today we saw another example of an employee (of Viacom) protecting her rights as a tax whistleblower under the Sarbanes-Oxley (“SOX”) and Dodd-Frank Acts*.   In a nutshell, retaliation against an employee of a company that is subject to these securities laws for whistleblowing is illegal.  For this reason we have been including language in our submissions to clearly fall under the SOX anti-retaliation provisions since the founding of our whistleblower practice in 2007.

In Vannoy v. Celanese Corp., ALJ Case No. 2008-SOX-00064, ARB Case No. 09-118 (ALJ July 24, 2013), an administrative law judge ruled in favor of a whistleblower who was fired after turning over confidential company data to the IRS.  As it relates to the tax whistleblowing that Vannoy did, the judge held that Disclosures to the IRS are Covered by SOX.  The judge said that a whistleblower “engages in protected activity when he or she complains about a violation of any “rule or regulation of the Securities and Exchange Commission” when the “information or assistance is provided to . . . a Federal regulatory . . . agency.” 18 U.S.C.A § 1514A. The statutory language does not in any way narrow the definition of “federal regulatory . . . agency” to include exclusively the SEC or the Department of Labor. There is nothing in the statutory language that limits the agencies to which a complainant may report information in furtherance of enforcement of laws that fall within the SOX’s coverage. It would be incompatible with the congressional intent to promote disclosures of corporate misconduct to narrowly construe the statute in such a way that only reports to the SEC warrant its protection.

Because the judge found that Celanese had retaliated against Vannoy by firing him for being an IRS whistleblower and for objecting to what he perceived was the company’s illegal tax avoidance, the court awarded Vannoy with relief under SOX including: 1) all his back pay from the time of termination with annual raises, 2) forward pay in the amount he would have earned if he was still employed, 3) full attorney’s fees and costs, and 4) an additional monetary award for the distress the taxpayer put him through.  It is not public information whether or not the IRS also paid him as a whistleblower for the issue he reported.

Unfortunately some whistleblowers become targets of their employers when they internally blow the whistle on illegal tax positions taken by the company, which is what happened in the Vannoy case and is what is alleged in the Viacom case.  It is this fear of retaliation that leads many whistleblowers to simply report the non-compliance to government agencies first, rather than pursuing the internal company channels.  (Vannoy was an internal whistleblower first, then went to the IRS, whereas the whistleblower in the Viacom case appears to have only internally blown the whistle on the tax issue she believed was improper.)  Unfortunately, it appears that only through the reporting of these violations of law to the IRS or applicable Federal regulatory agency that these whistleblowers are offered the anti-retaliation protections of SOX, but the Viacom case may test the extension of such protections under SOX to internal whistleblowers. In other words, is it fair that if you report to the IRS you are protected, but if you report to your boss you can get fired?

The moral of the story though is that it does not pay to retaliate against tax whistleblowers who have reported their issues to the IRS.  Most companies already knew that retaliating against a whistleblower was a bad idea and that instances of known retaliation are very rare. We’ll keep an eye on the Viacom case and report back with developments.


*The Sarbanes-Oxley Act of 2002 as partially amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”).

Whistleblower Office FY 2014 Annual Report Released, What Did We Learn?

Key Points from the Body of the Report

  • Final Regulations were a “top priority” and added “necessary clarification and provided additional guidance for whistleblower submissions under 7623.”(p. 4).  The report also notes that “the regulations confirm that the director, officers, and employees of the Whistleblower Office are authorized to disclose return information to the extent necessary to conduct whistleblower administrative proceedings.”
    • The WBO began the process of updating the IRM, correspondence, policies, and procedures accordingly.
    • The impact of the final regs is further seen in this report as 2 points from the FY 2013’s section on “Other Issues of Interest” are not present in this 2014 report. Those points concerned what constituted “collected proceeds” and a request for clarification of dollar amount thresholds for gross income and amounts in dispute.
  • The Whistleblower Office had a net increase of 3 senior analysts in FY 2014, brining the total staff of the Whistleblower Office to 43.
  • The report notes that the WBO “has seen steady and consistent grown from year to year in both staffing and claim submissions.
  • The Deputy Commissioner, Services and Enforcement directed a program review to ensure the resources committed to the WBO  are “applied efficiently and effectively” – the assessment is expected to be completed in FY 2015.
  • The FY 2014 report again notes that “Rules on access to and disclosure of taxpayer information could provide stronger protection for taxpayers.” – Noting two concerns:
    • (1) Current law does not provide a sanction if a whistleblower discloses taxpayer information in violation of a confidentiality agreement and 6103(h).
    • (2) The whistleblower may disclose the identity of the taxpayer in Tax Court or other judicial proceeding. 
      • The report notes that the second concern was addressed in a revision to Tax Court Rule 345 which now requires the taxpayer information to be masked in documents filed with the Court.
    • As a third (3) concern – the report states that “release of information during discovery in Tax Court proceedings is not addressed in the new rules and has brought a new set of concerns.” (p. 7).
  • The President’s FY 2014 Budget has included a legislative proposal to address this issue by providing a sanction for disclosure of taxpayer information obtained from the IRS as part of the award claim process.
  • The law does not provide for whistleblower protection unlike other laws that encourage whistleblowers to report information. (Same statement as 2013).
  • The WBO has limited information about the extent of whistleblower’s contribution in criminal cases due to information being protected from disclosure under FRCP. (Same statement as 2013).

Notable Statistics from Tables in the Appendix

  • Overall the claim and award numbers are substantially similar to 2013 Report with indications that FY 2015 numbers will be higher.
  • Table 6 of the report shows the awards paid from 2010 through 2014.  There were 101 awards paid in FY 2014 which is down from 2013’s 122 and 2012’s 128.  Collections of $2 million were up in 2014 to 9 from 6 in 2013.  The total amounts of awards paid in 2014 was down slightly from 2013 at $52,281,628 (from $53,054,302 in 2013).  However, the awards paid as a percentage of amounts collected was up to 16.9% in 2014 which is a nice increase from 14.6% in 2013.  (All but one of these wards we paid under section 7623(a).)
  • Sequester required reductions that were 7.2% of the amount that would have otherwise been payable in FY 2014.  Reductions totaling $3,764,722 were applied to awards paid during FY 2014.  Thus, the total amount of payments, after reduction, was $48,516,906.
  • In the “Amounts Collected and Awards Paid” Chart, the report uses the pre-sequester reduction number.
  • Total claims received is up from 2013, going from 10,520 to 14,365 (total submissions were 4,166 up from 4,067 in the 2013 report). (Table 1).
  • The report cited that the most common reasons for denial of claims were “non-specific allegations, issues that were below the threshold for IRS action, and allegations that did not identify a tax issue.” (Table 3).
  • The report cited that a total of 238 claims were closed in FY 2014 as a result of awards being paid in full.  That number is significantly increased from the number reported in the 2013 report, where only 130 awards were paid in full. (Table 3).
  • Overwhelmingly, the most common reason for closures in 2014 was “no tax issue” which differs from the 2013 report that noted “allegations unclear or non-specific” as the most common reason for closures in that year.
  • Table 2 shows that the vast majority of submissions go to SBSE and LB&I.  The table reports that those operating divisions received 138 and 134 section 7623(b) submissions respectively as compared to TEGE, which only received 24. 
  • The only operating division that had more (b) submissions and claims than (a) submissions and claims was CI.
  • Table 4 of the report details the status of open 7623(b) claims for all years.  Particularly noteworthy is the category of “Case Suspended: Whistleblower Litigation Regarding Award Determination” which was reported as 10 claims in 2013, is up to 41 claims in the 2014 report.  Additionally, the category of “Case Suspended Payment Received, Awaiting Expiration of Statute  of Limitations on Taxpayer Claim for Refund” was reported as 161 claims in 2013, is now up to 514 in the 2014 report, which means the IRS has now collected tax as a result of over 500 whistleblower cases for which it has not yet paid an award because it is waiting for the section 6511 statute of limitations on refunds to expire (the “two year rule”).  The table indicates that 2 claims from 2 whistleblowers fall into the category of “Final Award Processing.”  Finally, the report notes that Table 4 does not reflect some changes that were supposed to be made to the data via manual input in FY 2014.  Due to staffing issues, those changes are deferred to FY 2015 and data will be more accurate once those changes are made.
  • Table 5 shows data of “Days in Current Status” of the open 7623(b) claims.  The table shows a significant increase from the 2013 report in both average number of days and longest days of “whistleblower office – initial review” – 85 and 673, respectively (up from 64 and 405 in the 2013 report).  The table includes a status called “whistleblower office – manager approval for preliminary award recommendation letter” – and reports the average number of days and longest days for that status as 42 and 94 respectively.  Although that category was not included in the FY 2013 report, the 2013 report did have a category called “whistleblower office – award evaluation.”  Finally, the 2014 report included a status called “final award processing” and reported average number of days, longest days, and shortest days for that status as 218 for the two claims that fall under this category, which should be the very brief final stage of a whistleblower claim.

The office of Senator Chuck Grassley (R-IA) issued a press release yesterday announcing that the Senator had received a response from IRS Commissioner John Koskinen to questions Senator Grassley had submitted to the record after a February hearing on the IRS budget.  Senator Grassley’s question is presented below in three parts with Commissioner Koskinen’s responses following each part.  

Q.  “First, the payments to whistleblowers have slowed to a trickle at best. This is whistleblowers waiting for payment where dollars have been collected and the holdup is with the IRS processing and checking the boxes for a payment. Often it is the whistleblower office waiting for someone in the field, or in senior management to move paper. I ask that that your office review all whistleblower cases pending payment and bring the Drano to unclog the holdup.”

A.  “I have discussed with the Director of the Whistleblower Office the pace of award payments under section 7623, and have verified that he has made timely processing of claims for which an award is payable a top priority. Awards cannot be paid until the relevant taxpayer audit or investigation is completed (including any appeals), proceeds are collected, and the statute of limitations for filing a refund claim has expired. When those preconditions are met, the Whistleblower Office moves as quickly as possible to notify the whistleblower of a proposed award, obtain comments on the proposal, and make an award decision. To date, the Whistleblower Office has paid 12 awards under section 7623(b). The Director estimates that six to twelve additional 7623(b) awards will be paid in FY 15.”

Q.  “Second, I again find myself frustrated with an IRS Chief Counsel office that seems to wake up every day seeking ways to undermine the whistleblower program both in the courts and the awards. I am especially concerned that chief counsel is throwing every argument it can think of against whistleblowers in tax court. It appears at times that the Chief Counsel’s office thinks its job is to come up with hyper technical arguments and seek to deny awards to whistleblowers who have risked their lives to uncover big time tax cheats. I ask that your office and the director of the whistleblower office review the chief counsel’s wasteful and 16 harmful litigation positions that undermine the whistleblower program and go directly against your support for the whistleblower program.”

A.  “With respect to your second point, the IRS Office of Chief Counsel is responsible for defending the determinations of the IRS in the U.S. Tax Court, including those of the Whistleblower Office. The Office of Chief Counsel coordinates with the Whistleblower Office in defending its determinations before the Tax Court to ensure that Chief Counsel’s litigating positions are consistent with the program’s goals as well as the statutory and regulatory framework. In most cases before the Tax Court, the record of the case is sealed to protect both whistleblower and taxpayer interests. As a result, I cannot comment on specific arguments made in defending particular Whistleblower Office determinations that are subject to an order of the Tax Court sealing the record. The positions taken by the Office of Chief Counsel support the IRS’s administration of the law.”

Q.  “Third, with tight budgets at the IRS it is all the more imperative that the IRS works with whistleblowers and their counsels on cases. The IRS criminal investigators have had great success using whistleblowers to go after banks and terrorist organizations, but the IRS civil division still hasn’t gotten the message of working with whistleblowers. I note that the IRS hasn’t been shy about paying outside law firms big money to help it in big examinations, yet ignores the possibility of harnessing whistleblowers and their lawyers who won’t cost the IRS a dime from its budget.”

A.  “The suggestion that the IRS can do more to work with whistleblowers and their counsel is one that the IRS takes seriously. In a memorandum dated August 20, 2014, the IRS’s Deputy Commissioner of Services and Enforcement reinforced previous guidance on the importance of thorough debriefing of whistleblowers during the evaluation of their submissions. After the IRS begins an investigation based on whistleblower information, section 6103 provides limited authority to interact with a whistleblower since disclosure of taxpayer information would be necessary to gather additional information while pursuing the audit or investigation.”

With respect to Commissioner Koskinen’s response to the second question above, he surely drafted his response before the recent Tax Court decision in Whistleblower 21276-13W v. Commissioner, 144 T.C. No. 15, where the IRS Office of Chief Counsel took the position that petitioners were not award eligible because they failed to submit their Forms 211 before providing information to the IRS – a position that was shot down by the Tax Court as contrary to the requirements of section 7623.  In his press release, Senator Grassley also commented on the outcome of that case stating:

“The law was intended to direct whistleblowers and the IRS to work together to catch tax cheats.  Bureaucratic barriers don’t get the job done.  The IRS should welcome whistleblowers with a red carpet instead of putting up arbitrary legal hurdles at every turn.”

Citizens for Tax Justice just published a thought provoking five-year tax study of U.S. multinationals, as covered in an article today by Thomas Reuters journalists Kevin Drawbaugh and Patrick Temple-West.  The study, which sampled 288 Fortune 500 companies, found that 26 of them paid zero federal income tax in the five year period from 2008 through 2012.  As the article points out, perhaps even more aggravating is that 111 of the 288 companies that were sampled paid zero federal income tax in at least one of the five years. 

Among the 26 companies that paid no federal income tax in five years, are perennial Ferraro 500 list topping companies, General Electric and Verizon.  Naturally, corporations defend themselves by asserting that they play by the tax rules.  The article quotes GE spokesman Seth Martin who claims that Citizens for Tax Justice “inaccurately uses the current tax provision – a book accounting number – to make definitive statements about our U.S. income taxes.  This is not the same as the cash income tax that we pay for a given year.”  While that is an interesting defense, we are not going to get into differences between tax and book accounting here.  However, it is interesting to note that GE reserved over $6.5 billion for uncertain tax positions in 2013, and even topped the Ferraro 500 in 2010 with over $8.7 billion in tax reserves.  We’ll just leave it there. 

On February 4th, the IRS released statistics on the filings of Uncertain Tax Position Statements (Schedule UTP) for the 2012 tax year.  The statistics show there were 1,743 Schedule UTP filers and 4,166 uncertain tax positions reported for the 2012 tax year.  Both numbers are down from 2011 and 2010 numbers despite massive tax reserves being held by the largest corporations.  The IRS must be disappointed by the Schedule UTP numbers because they were disappointed with the 2010 numbers and 2012 is even lower.  The disappointing Schedule UTP numbers are opportunity knocking for potential tax-whistleblowers with access to a company’s tax accrual work papers.  As IRS resources continue to dwindle, the tax-whistleblower program may be the last line of defense for enforcement of corporate tax laws.

The drop in Schedule UTP filers and uncertain tax positions reported is particularly curious because the asset threshold for those corporations that must file Schedule UTP dropped from $100 million to $50 million for the 2012 tax year. 

Logically, one would expect the IRS to reel in more filers and uncertain tax positions with their wider net.  The drop in numbers not only signifies that Schedule UTP is not capturing more fish in between the $50 to $100 million asset range, but more importantly, it could signify that many companies that filed Schedule UTP in previous years have failed to comply in 2012.

The aim of the Schedule UTP is to capture information that taxpayers reported to their financial auditors for the purpose of establishing cash reserves for their uncertain tax positions.  More specifically, under the accounting requirements of FIN 48, a company must reserve, or hold back, earnings for tax positions for which the company thinks the IRS has a greater likelihood of prevailing than the company. 

Of course, as discussed in an earlier blog post, the Schedule UTP has largely been an inadequate tool for the IRS.  As corporations aggregate tax positions and provide very general  “concise descriptions” of their tax issues, the Schedule UTP has not turned out to be the roadmap for an IRS audit that it was once feared to be.

Nevertheless, the Schedule UTP is a tool that assists IRS agents in issue spotting and enforcement of tax compliance becomes increasingly difficult without it.  The complex nature of tax law and the difficulty in auditing large corporations whose tax lawyers and accountants are consistently looking to exploit murky tax laws puts the IRS behind the eight-ball in trying to enforce corporate tax compliance.  Added to this, the IRS must accomplish its mission with a reduced budget and reduced resources under the watch of a distrusting public.  Now, the Schedule UTP numbers for 2012 are yet another blow to corporate tax enforcement.  

In these trying times for the IRS, the tax whistleblower program remains a key tool for tax enforcement.  As the IRS’s resources are further reduced, tax whistleblowers should now, more than ever, step up and be that resource the IRS desperately needs. 

Last week Senator Charles Grassley (R-Iowa) wrote a letter to John Koskinen, former chairman of Freddie Mac, congratulating him on his nomination as the Commissioner of the Internal Revenue Service.  After congratulations were out of the way, Senator Grassley got right down to business by asking for Koskinen’s help in encouraging the IRS to use the “tools” it has been given to efficiently collect revenue.  The letter read like an offer to work as a team, with Grassley listing problem areas in IRS enforcement and asking Koskinen for his support, thoughts and feedback.  Specifically, Grassley emphasized his displeasure with the way the IRS has treated the private debt collectors program (PDC) and the IRS whistleblower program, asking Koskinen to reinstate the PDC and to “review the work and role of the IRS Whistleblower Office.”

In the letter, Grassley stated that “before increasing taxes on the millions of law-abiding Americans who voluntarily comply with the tax law, Treasury and IRS should make every effort to collect the billions of dollars in taxes that currently go uncollected.” To that point, Grassley’s frustration with the IRS and Treasury came through in the letter as he noted, “Over the past decade I have sought to provide the IRS with additional tools to track down tax cheats and collect funds through the enactment of the Private Debt Collection program and the expansion of the IRS whistleblower program.  Unfortunately, both programs have been fought every step of the way by some within Treasury and IRS who have an ideological disposition to oppose any program that seeks to utilize “private” or non-government resources to reduce the burden on the IRS.”

Grassley pointed out the success that the whistleblower program has had when it has been utilized by the IRS but said that “despite this success, many at the IRS, and especially Treasury and Chief Counsel have undermined the program and have discouraged whistleblowers from coming forward.” Grassley noted four problems: (1) payouts under the program are few and far between; (2) the IRS agents refuse to fully utilize the whistleblower’s knowledge and expertise; (3) whistleblowers “who put their whole career on the line frequently have to wait for years in the dark with no information as to whether or when the IRS will act on their claim”; and (4) Treasury is proposing regulations that will undercut the whistleblower program “with a shortsighted view that will save a penny today and lose the Treasury much more in the future due to discouraged whistleblowers not coming forward.”

Grassley pointed out that the Department of Justice has found success “to the tune of billions of dollars” that were recovered under the False Claims Act by working with whistleblowers and their representatives. He said that the IRS would find similar success by working with whistleblowers and their attorneys “if it would only get out of its own way.”  Grassley said that the fact that the IRS has delegated its authority to request whistleblower assistance solely to the IRS filed offices that have no understanding, guidance or support is “inexcusable.” Grassley even requested that the IRS implement a recognition program that would reward those IRS agents and examiners who work with whistleblowers to achieve “superior accomplishments.”

To finish up the letter, Grassley specifically asks Koskinen for several showings of support and follow-ups, including Koskinen’s commitment to affirm the Whistleblower Office’s authority to contract with whistleblowers and their representatives and to provide clear direction that contracting is “encouraged and should be a priority.”  Expressing the need for the IRS to reassure whistleblowers that they are valued and will be treated fairly, Grassley said that the proposed regulations would have the effect of discouraging whistleblowers and giving comfort to tax cheats. Grassley said “Time and time again the writers of the proposed regulation turn a blind eye to the plain meaning of the statute I wrote, the policy of the statute rewarding whistleblowers, and the precedence of the False Claims Act.”  Since the regulations would require Koskinen’s approval before made final, Grassley asks Koskinen to review the proposed regulations, Grassley’s correspondence with Treasury and the IRS on the matter, and the comments on the regulations by the leading whistleblower representatives.  Taking that concern a step further, Grassley asks Koskinen to provide him with his thoughts on the whistleblower program along with the steps that Koskinen intends to take to “ensure success is realized – particularly those steps you can take under your own authority such as improved communication with whistleblowers during the process – and your views on the proposed regulations – especially on the issues of “related action,” “collected proceeds,” and “planned and initiated.”

Clearly, Grassley’s frustration with the IRS and Treasury regarding the PDC and the whistleblower program will not be lost on Koskinen.  Grassley’s letter was not just a rant of everything that is wrong with the IRS and the whistleblower program, instead the letter is an invitation to improve the program and increase much needed revenue for the federal government.  What’s more, is that Grassley is giving the top IRS nominee a heads-up on whistleblower issues that will bring him success if they are solved.  Grassley is seeking Koskinen’s commitment to the tools and resources he put in place for the IRS but is also seeking his feedback and thoughts.  In this way, Grassley’s letter is largely a symbol of his support and commitment to the whistleblower program and he is simply asking for the same in return from Koskinen.  After all, as Grassley points out, “it is incumbent on the IRS to work smarter and utilize all the resources currently at its disposal.”