Whistleblower claim must be credible and not speculative or nonspecific.
A whistleblower who provides information to the IRS about another party’s unpaid taxes may be entitled to an award. The information must not be speculative or nonspecific and must be credible. Also, the IRS Whistleblower Office (WBO) must take action against the target and collect proceeds. One whistleblower claimed that a taxpayer had taken tax deductions for remediating environmental damage. The whistleblower claimed the expenses weren’t for remediation, but to cover up damage and avoid massive fines. The WBO rejected the claim without considering its merits, and no award was made. The U.S. Tax Court had jurisdiction to review the case but ordered further proceedings. (153 TC No. 8)