Whistleblower Misses Award After IRS Cuts Claim Below Threshold

A whistleblower can’t claim the fraud committed by a taxpayer exceeds $2 million in order to trigger an automatic reward, the US Tax Court said.

The Tax Court upheld an IRS determination against Marie Claudia Estorge, determining that she did not meet the $2 million threshold for a mandatory whistleblower award under IRC Section 7623(b)(5), Judge Courtney D. Jones wrote. This despite her claiming the taxpayer had defrauded the government of more than that amount in taxes, interest, penalties and fees.

“The term ‘proceeds in dispute’ does not refer simply to the amount the whistleblower alleges might have been ...