On Monday, March 10th, National Whistleblower Center wrote to the Department of Government Efficiency (“DOGE”), urging the Department to maximize the Internal Revenue Service (“IRS”) Whistleblower Program during its review of the agency.
In the letter, NWC Chairman of the Board of Directors Stephen M. Kohn and Senior Policy Analyst Dean Zerbe outlined the benefits of the program. IRS whistleblower-based examinations bring in $398 more per hour compared to the DIF-selected audits while also maintaining an operational cost over half that of other IRS enforcement programs. The letter also detailed how no-change rates of whistleblower-based audits were lower than the average 12% rate for DIF-selected audits.
The sitting administration has voiced its support of the program, and the letter aims to assist the administration with bolstering the efficacious program so that it can realize its full potential. During his Senate confirmation hearing, Treasury Secretary Scott Bessent affirmed his support for the program, stating that he and Senator Grassley – a champion of the program – were in “complete alignment on this program.” President Trump has also recognized the benefits of whistleblowers, encouraging them to leverage the False Claims Act in his Executive Order 14173.
In an attached addendum, Kohn and Zerbe outlined reforms which could see the increased productivity of the program. Recommendations include closer collaboration with tax whistleblowers and their attorneys, expanding the scope of whistleblower awards, removing limitations of the definition of a whistleblower, the payment of partial awards, and removing arbitrary and capricious award caps.
Commenting on the letter, author Dean Zerbe stated: “The Congress and the administration should take a hard look at providing the IRS reimbursement for when it works whistleblower cases resulting in awards. It is common practice for False Claims Act cases that the agency is reimbursed for investigative costs. Such a rule does much to align the interests of the government and the whistleblower and helps ensure good whistleblower cases are worked. When Grassley first considered the IRS whistleblower legislation it included language that provided for reimbursement. Congress should revisit that idea.”
“The IRS whistleblower program provides tremendous benefit to the work of the IRS – allowing for more efficient use of limited resources, better targeting of examinations on those evading tax laws – and leaving honest taxpayers in peace. Doubling down on the IRS whistleblower program is commonsense.”
