IRS Tax Whistleblower Program Update: IRS Authorizes Contingent Fee Arrangements for Retaining Lawyers in Tax Whistleblower Cases

The new IRS Whistleblower Program authorized by Congress in December 2006 continued its progress this week, with the IRS’s announcement yesterday approving the use of contingent fee arrangements in retaining tax whistleblower attorneys.

Our whistleblower lawyer blog has followed the development of the new IRS Whistleblower Program since its infancy. The new tax whistleblower provisions are extremely important in the fight to protect taxpayer funds from fraud and other violations of the law.

In this March 27, 2008 announcement, Notice 2008-43, the IRS announced interim rules that would apply until it amends section 10.27(b) of Circular 230.

Citing the revised IRS Whistleblower statute, the interim rules state that “[a] practitioner may charge a contingent fee for services rendered in connection with a claim under section 7623 of the Internal Revenue Code.”

This is the second IRS announcement just this week about the new IRS Whistleblower Program. On March 25, 2008, the IRS announced temporary regulations concerning disclosing information to whistleblowers under contracts among the IRS, whistleblowers, and their attorneys.

We congratulate the IRS on moving forward with the new Whistleblower Program’s development.