Whistleblower Award Not Warranted in $60 Million Tax Probe

A whistleblower isn’t entitled to a share of an erroneously claimed $60 million deduction because the IRS discovered the issue on its own, not based on information the whistleblower provided, the U.S. Tax Court ruled.

Michael Lissack informed the IRS in 2009 that a group of entities that developed condos and offered beach and golf club memberships failed to report millions of dollars in membership fees in their gross income.

An IRS examination determined that the entities had properly treated the membership fees as nontaxable deposits, but a revenue agent discovered an erroneous deduction for intercompany bad debt. ...