Summary
This D.C. Circuit opinion reviews a challenge to an IRS Whistleblower Office decision that awarded a taxpayer informant only 22% instead of the statutory maximum 30% of recovered proceeds. The Office justified the reduction by claiming the investigating field team discovered the tax violations independently, but the court found this factual determination clearly erroneous given the record. Consequently, the court vacated the Tax Court’s affirmation of the award and remanded the case for further proceedings consistent with its analysis.
Topics
Practice areas
Questions Presented
- Whether the Tax Court’s grant of summary judgment should be reviewed under an abuse of discretion standard
- Whether the Whistleblower Office’s factual finding that the field team discovered the misconduct independently was clearly erroneous
Holdings
- The Tax Court’s grant of summary judgment is vacated and the case remanded for further proceedings.
Key quotations
“Because the Whistleblower Office’s factual finding is not supported by the record, we vacate the Tax Court’s decision affirming the award and remand for further proceedings.” (at 1)
“The Whistleblower Office’s award rested on the clearly erroneous factual finding that the team had done so, the award cannot stand.” (at 1)
Factual background
The appellant, a whistleblower, provided information that led the IRS to recover hundreds of millions in taxes from several firms. He received five whistleblower awards, four at the maximum 30% rate and one at 22% because the IRS claimed the field team discovered the misconduct independently. The court found the IRS’s factual finding unsupported.
Procedural history
The Tax Court granted summary judgment to the government, affirming the IRS Whistleblower Office’s 22% award. The appellant appealed to the D.C. Circuit.
Remand instructions
Remand for further proceedings consistent with this opinion.