The U.S. Tax Court has given the IRS until Sept. 24 to respond to
an amicus brief in support of what could amount to an award of tens of millions
of dollars for whistleblower Joseph Insinga, an informant who implicated seven
major corporations in tax evasion in 2007 (Insinga v. Comr., Tax Court Order No. 4609-12W (7/31/12)).
The issue is whether the Administrative Procedures Act applies to
the IRS in this case and whether inaction is tantamount to a negative
determination.
The case will be closely watched by informants because of its
potential to impact other slow-moving IRS whistleblower claims and also because
it is the first to invoke the Administrative Procedures Act in a whistleblower
case. The act confers jurisdiction on the court if agency action or
failure to act aggrieves an individual.
Five-Year Wait
For Insinga, it is a matter of having waited five years for the IRS
to decide if it will pay him on claims he made as a former Rabobank managing
director against corporations such as General Mills and Newell Rubbermaid. The
IRS has already collected hundreds of millions of dollars in taxes, penalties,
and interest on his information, according to the court documents.
In the original Tax Court petition, Insinga alleged that the IRS advised him that his submission
was defective because the IRS had recently discovered “other sources” of the
information he had furnished in April 2007.
If they deny his claim, he has the right to go to federal court and
seek the court's help. However, they haven't denied his claim and they
haven't approved it either.
A June 27 amicus brief filed by Dean Zerbe, attorney with Zerbe,
Fingeret, Frank & Jadav, on behalf of the National Whistleblowers Center,
was designed to compel the Tax Court to make a final decision without
delay.
The IRS, in its March 21 motion to dismiss the case, said that the
court does not have jurisdiction until the IRS issues a determination letter.
There has been no denial letter issued to Insinga, nor has a determination been
made in the case, IRS said. Furthermore the IRS said the statute does not set
forth any time limits within which a determination must be made.
The IRS is taking the position that they don't have to pay us
until the last of all the cases we reported is paid or otherwise disposed of.
Insinga has argued that he should have an award determination based
on the amount the IRS has already collected from his claim—an estimated $600
million—within 90 days after the IRS was paid.
He estimated that the offshore and other tax avoidance transactions
he identified would result in a total of $1.5 billion in collection of unpaid
taxes, penalties and interest for the IRS.
The IRS has come under pressure from a number of sources to move
whistleblower claims along. Sen. Charles Grassley (R-Iowa), for one, said the
IRS's handling of the program has been inexcusable, and threatened to block two
pending Treasury Department nominees from getting a confirmation vote until he
got answers about implementation of the program. Grassley wrote the 2006
legislation that overhauled the whistleblower program, and has kept a lookout
over its development.
IRS Deputy Commissioner for Service and Enforcement, Steven Miller,
also buoyed the hopes of whistleblower community when he announced June 20 that
he is reviewing the program, which will lead to “a set of expectations for
timely action.”
Until that time he said the Whistleblower Office should evaluate
claims within 90 days, and whistleblowers should be notified of an award
decision within 90 days of when collected proceeds can be finally
determined.
But all eyes are on the Tax Court, since the Miller memo is not
binding. “If the court comes out and directs the IRS to make a decision in a set
number of days—such as 90 days—it would really break a logjam, because there are
so many folks waiting for the IRS to make a decision.
If you have questions about the IRS' Wistler Blower Program, contact the Tax Lawyers at Marini & Associates, P.A.
for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free at 888-8TaxAid (888 882-9243).
IRS Granted Another Extension to Respond In ‘Insinga'
ReplyDeletePosted November 2, 2012, 6:57 P.M. ET
The Tax Court granted the Internal Revenue Service another extension of time, until Nov. 8, to file a response in a whistleblower case that would force the service to begin paying informants before it has closed out all their claims (Insinga v. Commissioner, T.C. , No. 4609-12W, 10/26/12).
IRS previously received an extension of time from Sept. 24 to Oct. 29 to respond to the National Whistleblowers Center's amicus curiae brief in support of whistleblower Joseph Insinga's claim for payment on information implicating seven major corporations in tax avoidance.
Insinga, a former Rabobank managing director, alleged that corporations such as General Mills and Newell Rubbermaid were engaged in offshore and other tax avoidance transactions that would result in a total of $1.5 billion in collection of unpaid taxes, penalties, and interest for IRS.
Source
BNA
The Internal Revenue Service Nov. 8 said until it makes a determination on whether to pay whistleblower Joseph Insinga for his claims against seven major corporations, the U.S. Tax Court has no jurisdiction over the case and nothing can confer jurisdiction on the court other than the IRS's own determination.
ReplyDeleteAt issue is whether the Administrative Procedures Act applies to IRS in the case, Insinga v. Commissioner, and whether inaction is tantamount to negative action (Insinga v. Commissioner, T.C., No. 4609-12W, response 11/6/12).
The APA confers jurisdiction on the court if agency action or failure to act aggrieves an individual.
Insinga said the government has already collected hundreds of millions of dollars in taxes, penalties and interest on his information. The amicus brief filed by Zerbe, Fingeret, Frank & Jadav on behalf of the National Whistleblowers Center is designed to compel the Tax Court to make a final decision without delay.