Whistleblower Lawyer Blog

UNITED STATES TAX COURT
WASHINGTON, D.C. 20217
June 2, 2008
PRESS RELEASE

Chief Judge John O. Colvin announced today that the United
States Tax Court has proposed amendments to its Rules of Practice
and Procedure regarding whistleblower award actions and
electronic service. The Court has also proposed various
conforming and miscellaneous amendments to its Rules and forms.
The proposed amendments are contained in the Notice attached to
this press release and are available at the Tax Court’s Web site
at www.ustaxcourt.gov.

Chief Judge Colvin also announced that the Tax Court invites
public comment on the proposed amendments. Written comments must
be received by July 31, 2008. Comments must be addressed to:

Robert R. Di Trolio
Clerk of the Court
U.S. Tax Court
400 2nd St., N.W., Room 111
Washington, D.C. 20217
UNITED STATES TAX COURT
WASHINGTON, D.C. 20217

NOTICE OF PROPOSED AMENDMENTS TO RULES

Pursuant to section 7453 of the Internal Revenue Code as
amended and Rule 1 of the Tax Court Rules of Practice and
Procedure, the United States Tax Court hereby provides notice
that it proposes the attached amendments to its Rules of Practice
and Procedure and invites public comment thereon. Written
comments must be received by July 31, 2008. Comments must be
addressed to:

Robert R. Di Trolio
Clerk of the Court
U.S. Tax Court
400 2nd St., N.W., Room 111
Washington, D.C. 20217

The proposed amendments and explanations are as follows.

I. Whistleblower Awards

Introduction

In 2006, Congress amended section 7623 by adding new
subsection (b), which authorizes the Whistleblower Office of the
IRS to determine the amount of awards to whistleblowers based on
a percentage of the tax collected. Section 7623(b)(4) confers
jurisdiction on the Court over appeals of the award
determinations, effective for determinations with respect to
information provided on or after December 20, 2006. Accordingly,
it is proposed that Rules 13, 34, and 182 be amended and new
Title XXXIII (Rules 340-344) be adopted to provide procedures for
commencing a whistleblower award action.

* * * *
New Title XXXIII is added.

TITLE XXXIII
WHISTLEBLOWER AWARD ACTIONS

Prefatory Note

The Rules of Practice and Procedure of the United States Tax
Court are amended by adding a new Title XXXIII, relating to
whistleblower award actions. This title has been added because
of the enlargement of the Court’s jurisdiction by sec. 406 of the
Tax Relief and Health Care Act of 2006, Pub. L. 109-432, 120
Stat. 2922. That section amended section 7623 by adding new
subsection (b) to provide for awards to whistleblowers. Section
7623(b)(4) confers jurisdiction on the Court over appeals from
determinations regarding awards under subsection (b)(1) through
(b)(3).

Title XXXIII consists of the following five new Rules:
Rule 340–-General
Rule 341–-Commencement of Whistleblower Award Action
Rule 342–-Request for Place of Trial
Rule 343-–Other Pleadings
Rule 344–-Joinder of Issue in Whistleblower Award Actions

The Rules of Title XXXIII are effective as to whistleblower
award actions commenced with respect to determinations regarding
awards based on information provided on or after December 20,
2006.

New Rule 340 is added.
RULE 340. GENERAL
(a) Applicability: The Rules of this Title XXXIII set
forth the provisions that apply to whistleblower award actions
under Code section 7623(b)(4). Except as otherwise provided in
this Title, the other Rules of Practice and Procedure of the
Court, to the extent pertinent, are applicable to such actions.
(b) Jurisdiction: The Court shall have jurisdiction of a
whistleblower award action under this Title when the conditions
of Code section 7623(b)(4) have been satisfied.
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Explanation
It is proposed that new Rule 340 be adopted to provide for
the general applicability of Title XXXIII and the jurisdiction of
the Court regarding whistleblower award actions.
The Court’s Rules generally contemplate disposition on the
administrative record for disclosure actions and declaratory
judgment actions, pursuant to specific legislative guidance.
Without specific statutory authority or evidence of legislative
intent establishing whether whistleblower award actions are to be
decided on the administrative record, Title XXXIII as proposed
follows the general procedures for deficiency and other types of
actions before the Court.
New Rule 341 is added.
RULE 341. COMMENCEMENT OF
WHISTLEBLOWER AWARD ACTION
(a) Commencement of Action: A whistleblower award action
under Code section 7623(b)(4) shall be commenced by filing a
petition with the Court. See Rule 20, relating to commencement
of case; Rule 22, relating to the place and manner of filing the
petition; and Rule 32, regarding the form of pleadings.
(b) Content of Petition: A petition filed pursuant to this
Rule shall be entitled “Petition for Whistleblower Award Action
under Code Section 7623(b)(4)” and shall contain the following:
(1) The petitioner’s name, State of legal residence,
and mailing address, stated as of the date that the petition
is filed.
(2) The date of the determination regarding an award
under Code section 7623(b)(1), (2), or (3) by the Internal
Revenue Service Whistleblower Office.
(3) Lettered statements explaining why the petitioner
disagrees with the determination by the Internal Revenue
Service Whistleblower Office.
(4) Lettered statements setting forth the facts upon
which the petitioner relies to support the petitioner’s
position.
(5) A prayer setting forth the relief sought by the
petitioner.
(6) The signature, mailing address, and telephone
number of each petitioner or each petitioner’s counsel, as
well as counsel’s Tax Court bar number.
(7) As an attachment, a copy of the determination.
(c) Filing Fee: The fee for filing a petition for a
whistleblower action shall be $60, payable at the time of filing.
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Explanation
It is proposed that new Rule 341 be adopted to provide
procedures for commencing a whistleblower award action.
Paragraph (b)(1) of new Rule 341 requires that the petition
contain only the name, State of legal residence, and mailing
address of an individual, as section 7623(b)(1) provides that a
whistleblower award may be made to an individual, which would
exclude awards to a trust, partnership, association, company, or
corporation. See section 7701(a)(1).
Paragraph (b)(2) of new Rule 341 does not require that the
petition contain the city and State of the Office making the
determination (see, e.g., Rules 281(b)(2), 331(b)(2)), as section
406(b) through (d) of Pub. L. 109-432 provides for the
establishment of only one Whistleblower Office.
New Rule 342 is added.
RULE 342. REQUEST FOR PLACE OF TRIAL
At the time of filing a petition for a whistleblower award
action, a request for place of trial shall be filed in accordance
with Rule 140.
Explanation
It is proposed that new Rule 342 be adopted to provide the
procedure for requesting the place of trial of a whistleblower
award action. The Rule reflects the general requirement under
Rule 140(a).
New Rule 343 is added.
RULE 343. OTHER PLEADINGS
(a) Answer: The Commissioner shall file an answer or shall
move with respect to the petition within the periods specified in
and in accordance with the provisions of Rule 36.
(b) Reply: For provisions relating to the filing of a
reply, see Rule 37.
Explanation
It is proposed that new Rule 343 be adopted to provide rules
for filing answers and replies in whistleblower award actions.
The proposed Rule adopts the pleading procedures used in most
types of actions before the Court, contained in Rules 36 and 37.
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New Rule 344 is added.
RULE 344. JOINDER OF ISSUE IN WHISTLEBLOWER AWARD ACTIONS
A whistleblower award action under Code section 7623(b)(4)
shall be deemed at issue as provided by Rule 38.
Explanation
It is proposed that new Rule 344 be adopted to provide for
joinder of issue in whistleblower award actions.