IRS awards $4.5M to whistleblower

IRS awards $4.5M to whistleblower


PHILADELPHIA – An accountant who tipped off the IRS that his employer
was skimping on taxes has received $4.5 million in the first IRS
whistleblower award.
The accountant's tip netted the IRS $20 million in taxes and interest from the errant financial-services firm.
The award represents a 22 percent cut of the taxes
recovered. The program, designed to encourage tips in large-scale cases,
mandates awards of 15 to 30 percent of the amount recouped.
"It ought to encourage a lot of other people to
squeal," Sen. Charles Grassley told The Associated Press. The Iowa
Republican helped get the IRS Whistleblower Office authorized in 2006.
The IRS mailed the accountant's lawyer a $3.24
million check that arrived in suburban Philadelphia by first-class mail
Thursday. The sum represents the award minus a 28 percent tax hit.
http://news.yahoo.com/s/ap/20110408/ap_on_re_us/us_irs_whistleblower_collects

I dont know but it is pretty bizarre that the IRS would pay an award for this and then tax it?