New York Catches Tax Cheats under its Tax Fraud Whistleblower Provisions
Whistleblower laws have wide range of powers and affects, but one of the most potent is New York’s Qui Tam provisions which enable an insider to turn in tax cheats and receive a whistleblower award.
Many Qui tam lawsuits are filed under the False Claims Act provide a way for the government to retrieve funds that they have been cheated of. These cases are usually filed by employees who work at a company that is conducting healthcare fraud, like Medicare Fraud or Medicaid Fraud. When the employee notices such activity, they can get in touch with a whistleblower lawyer to file an official report and initiate a secretive lawsuit against the employer. Different types of qui tam cases can be filed, and recent developments in New York are setting an example of how tax-related whistleblower lawsuits can be beneficial for the state government and to the whistleblower. There are also IRS Whistleblower actions, but those cases must be incredibly detailed and show over $2 million in fraud (underpayments or no payments) and generally significantly higher amounts.
Tax Fraud Whistleblower Cases In New York
New York State is one of the few states in the country that provides appropriate laws that ensure citizens in the state can file for a qui tam case if they know of tax fraud. When such a case is filed with a tax fraud attorney, state authorities are notified of the case and given the opportunity to intervene before the case becomes public.
The False Claims Act laws in New York State was modified in 2010 to allow the citizens to come forward with information that suggests different types of tax-related fraudulent activities are being conducted at their employer. Additionally, the law also ensures that the individual who blows the whistle is appropriately awarded for the fact that they filed the qui tam lawsuit. The reward provided to the whistleblower is granted only after the state has recovered the lost funds from the accused party. Rewards provided to the whistleblower for tax fraud qui tam generally range from 15% to 30% of the amount that the state recovers.
Since the initiation of these laws in the New York State, the government has already been able to retrieve over $56 million in lost funds thanks to whistleblowers speaking up about fraudulent activity that is conducted oftentimes by their employers. Some common schemes employers use to cheat on taxes is paying workers off the books, falsely designating workers as independent contractors instead of employees and outright not reporting income.
The state is setting an example for other states, as very few states currently have such laws implemented. Others states in the country are advised to consider looking at how New York has already benefited and in turn recouping money from tax cheats helps everyone with their taxes.
When tax fraud is detected, it is important to report the New York Tax Fraud the relevant authorities in the right manner utilizing a tax whistleblower lawyer. Citizens of the New York State are able to file qui tam cases under the False Claims Act, which then allows the whistleblower who filed the case to receive a reward if the case turns out to be successful. Contacting an experienced whistleblower attorney can ensure you have the foundation for at a case that may succeed, such as speaking with former FBI Special Agent and whistleblower lawyer Jason T. Brown of Brown, LLC.