“Whistleblowers and their advocates have long complained that they are unappreciated – or downright resented – at the Internal Revenue Service, but the agency gave them a pleasant surprise Friday.

Months after narrowing the circumstances under which whistleblowers could collect rewards for exposing tax evasion, the IRS reversed its position.

“This is really I think the first tangible evidence that the senior leadership [at the IRS] is getting behind the whistleblower program and wants to make it work,” said lawyer Dean Zerbe, who represents whistleblowers.

At issue is the IRS’s use of a law Zerbe helped write when he was Republican tax counsel to the Senate Finance Committee under Sen. Charles E. Grassley (R-Iowa). The idea was to give people with knowledge of unpaid taxes an incentive to help the government collect the money.”

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Original article by David S. Hilzenrath

Washington Post Staff Writer
Saturday, January 15, 2011