 WHISTLEBLOWER 21276–13W, PETITIONER v. COMMISSIONER
          OF INTERNAL REVENUE, RESPONDENT

 WHISTLEBLOWER 21277–13W, PETITIONER v. COMMISSIONER
          OF INTERNAL REVENUE, RESPONDENT

      Docket Nos. 21276–13W, 21277–13W.          Filed June 2, 2015.

         P–H was arrested for participating in a conspiracy to
      launder money. To minimize his punishment, P–H informed
      Government agents, including Internal Revenue Service (IRS)
      agents, that a foreign business (Targeted Business) assisted
      U.S. taxpayers in evading Federal income tax. P–H told the
      Government agents that the Targeted Business had no pres-
      ence in the United States and instructed its personnel to stay
      out of the United States. Although he did not have docu-
      mentation sufficient to inculpate the Targeted Business, P–H
      was aware of an individual who did. Because the individual
      (X) was outside the United States, P–H and P–W designed a
      plan to induce him to come to the United States. In executing
      the plan, P–W met with X and persuaded him to enter the
      United States. Upon entering the United States, X was
      arrested. While in custody, X agreed to assist the United
      States in its pursuit of the Targeted Business. After his
      release, X tried to back out of his agreement. But after
      meeting with P–H, X agreed to follow through on his commit-
      ment. In part because of X’s assistance, the Targeted Business
      was indicted, pleaded guilty, and paid the United States
      approximately $74 million. Ps filed separate Forms 211,
      Application for Award for Original Information, with the IRS
      Whistleblower Office, seeking awards under I.R.C. sec.
      7623(b). The forms were filed after the Targeted Business
      pleaded guilty and paid the United States $74 million. Upon
      receipt, the IRS sent Ps’ Forms 211 to its Ogden, Utah,
      Service Center, where a classifier noted that the forms were
      filed after the United States collected proceeds from the Tar-
      geted Business. On that basis, the Whistleblower Office
      rejected Ps’ award applications and sent Ps separate award
      determination letters stating that no proceeds had been col-
      lected using the information Ps submitted. The IRS asserts
      that the Tax Relief and Health Care Act of 2006, Pub. L. No.

290
(290)       WHISTLEBLOWER 21276–13W v. COMMISSIONER                        291


        109–432, div. A, sec. 406(b), 120 Stat. at 2959 (TRHCA sec.
        406(b)), provides the Whistleblower Office with exclusive
        discretion to either investigate the taxpayer or refer the
        information provided by the whistleblower to an IRS oper-
        ating division. The IRS further asserts that under TRHCA
        sec. 406(b) a whistleblower is ineligible for an I.R.C. sec.
        7623(b) award if he/she provides the information to an oper-
        ating division of the IRS before submitting the information,
        via a Form 211, to the Whistleblower Office. Held: TRHCA
        sec. 406(b) does not endow the Whistleblower Office with
        exclusive authority to investigate the individual or entity that
        is the subject of an application for an award. The fact that Ps
        supplied their information to other Federal agencies,
        including an IRS operating division, before submitting the
        information to the Whistleblower Office on Form 211 does not,
        as a matter of law, render Ps ineligible for an award under
        I.R.C. sec. 7623(b).

  Sealed, 1 for petitioners.
  Richard L. Hatfield, John T. Arthur, and Jonathan D.
Tepper, for respondent.

                                  OPINION

   JACOBS, Judge: In these consolidated cases petitioners,
husband and wife, seek whistleblower awards authorized by
section 7623(b), 2 asserting each brought to the Secretary’s
attention information which resulted in the collection of
unpaid Federal income tax. Petitioners each filed a Form
211, Application for Award for Original Information, with the
Internal Revenue Service (IRS) Whistleblower Office
(Whistleblower Office) when they learned of the whistle-
blower award program from one of the Government agents to
whom they provided information. The Whistleblower Office
summarily rejected each petitioner’s claim on the basis that
‘‘additional tax, penalties, interest or other proceeds’’ had
been collected before each petitioner filed his/her Form 211.
On the basis of its determination that petitioners’ claims
were untimely, the Whistleblower Officer did not review,
investigate, or evaluate the merits of petitioners’ claims.
  1 The names of petitioners’ counsel have been omitted in furtherance of
protecting petitioners’ identities.
  2 Unless otherwise indicated, all section references are to the Internal

Revenue Code as amended.
292        144 UNITED STATES TAX COURT REPORTS             (290)


   The documents in petitioners’ administrative files were
insufficient for the Court to conduct an effective review of
this matter. The only documents in each petitioner’s adminis-
trative file were (1) the Form 211, (2) an acknowledgment of
the receipt of the Form 211 assigning a claim number to the
respective petitioner, (3) a letter informing the respective
petitioner that his/her claim was still under consideration, (4)
a Form 211 Classification Checksheet, and (5) a denial letter
stating that the information provided did not result in the
collection of proceeds.
   The Court held a partial trial at a special session on
November 13, 2014, in Washington, D.C., in order to enable
the Court to determine (1) what information, disclosure, and/
or action, if any, petitioners provided to employees, agents,
and/or officers of the United States in detecting underpay-
ments of tax and/or detecting and bringing to trial and
punishment persons guilty of violating the internal revenue
laws or conniving at the same and (2) whether that informa-
tion, disclosure, and/or action satisfies the requirements of
section 7623(b). Undisputed facts were revealed at the par-
tial trial and are set forth infra.

                         Background
I. Petitioner Husband
   Petitioner husband assisted individuals who were engaged
in illegal activities. In 2009 he was arrested at his Florida
home, having been indicted as a coconspirator in a con-
spiracy to launder funds from the sale of pirated musical
compact discs. He was taken to a local detention facility. To
minimize his punishment, he agreed to cooperate with FBI,
IRS, and other Government agents by providing them with
information regarding the structure of various entities his
clients used in their illegal activities. After spending four
weeks in the local detention facility, he was transferred to
another facility in Philadelphia, Pennsylvania. In January
2010, petitioner husband pleaded guilty and entered into an
agreement with the Department of Justice to provide truth-
ful, complete, and accurate information and testimony. The
agreement stated that ‘‘[t]he defendant understands that if
he testifies untruthfully in any material way he can be pros-
(290)    WHISTLEBLOWER 21276–13W v. COMMISSIONER           293


ecuted for perjury’’ with respect to both his criminal activi-
ties and ‘‘any other crimes about which he has knowledge.’’
II. The Targeted Business
   While in detention in Philadelphia, petitioner husband
informed the Government agents that a foreign business
(Targeted Business) assisted U.S. taxpayers in evading Fed-
eral income tax. Through his acquaintance with several of
the officers of the Targeted Business, petitioner husband
became aware that the Targeted Business was organized like
a general partnership, with no liability protection for its
owners. Petitioner husband believed that were the United
States to bring criminal charges against the Targeted Busi-
ness, its partners would settle in order to avoid the loss of
business to the Targeted Business, as well as to avoid per-
sonal liability. Petitioner husband told the Government
agents that to avoid potential U.S. prosecution the Targeted
Business conducted no operations within the United States
and instructed its partners, officers, and employees not to
come to the United States.
   Petitioner husband did not have documentation sufficient
to inculpate the Targeted Business, but he was aware of a
senior officer of the Targeted Business (X) who did. Peti-
tioner husband believed he could devise a plan to lure X to
the United States, and he did.
III. X
   Petitioner husband had met X when X was an employee of
another entity. X had referred several individuals to peti-
tioner husband for business advice. Eight of the individuals
referred to petitioner husband were U.S. taxpayers. X
demanded a kickback, ranging from $1,500 to $2,500 per
client referral. Petitioner husband resented paying kickbacks
to X , but he did so because the amounts he received from
the referred clients were substantial.
   Petitioner husband believed X would disregard the Tar-
geted Business’ admonition not to come to the United States
if given sufficient financial motivation. Petitioner husband
further believed that if X came to the United States, Federal
law enforcement agents could arrest him, and to ‘‘save his
294         144 UNITED STATES TAX COURT REPORTS                    (290)


own skin’’ X would provide information which could be used
to indict the Targeted Business.
 We were very close, I knew that he is—even that he’s a super sports guy
 and * * * [triathlete]—whatever, he’s a weak person. Like, he is not a
 strong person. He will fold and give up and work with the U.S. govern-
 ment. That’s one thing I knew about him. And the other thing I knew
 about him, that he was very greedy and he was open to kickbacks, obvi-
 ously, what we introduced here, and that he was very vulnerable to
 malice. So, when we throw the bone, he will bite the bone. And when
 we have him, he will, excuse my English, spill his guts.

IV. The Plan
   In 2010 petitioners met with U.S. Government agents
(including FBI, ICE, and IRS agents), as well as British
agents from the Metropolitan Police Service (Met), to formu-
late a plan to entice X to enter the United States. The plan
was based on a transaction petitioners had used for one of
petitioner husband’s clients and with which X was familiar.
X would be told that one of petitioner husband’s clients had
embezzled funds which were used to purchase an aircraft. As
a reward for arranging financing to purchase the plane, peti-
tioner husband ‘‘received’’ $1.2 million. X would be told that
petitioners held the $1.2 million in a Bahamian bank account
to avoid payment of U.S. tax and that they wanted to move
the money into a new bank account which would be held in
the name of an ‘‘old boarding school friend’’ of petitioner hus-
band (beneficial owner). The beneficial owner to be intro-
duced to X would, in reality, be a Met agent. X would be told
that petitioners wanted him to assist them in transferring
the money, and in exchange for that assistance, X would
receive $40,000.
V. The Sting
   Petitioner husband was involved in the drafting of all
paperwork required to make it appear that an aircraft had
been purchased with financed money. He then contacted X,
and told him petitioners were in a dire situation and that it
was imperative for them to meet. X was told to meet peti-
tioner wife in England because petitioner husband could not
travel internationally after his arrest. X knew, but appar-
ently was not concerned, about petitioner husband’s arrest. X
had met petitioner wife previously, and he trusted her.
(290)     WHISTLEBLOWER 21276–13W v. COMMISSIONER                       295


  In February 2010 petitioner wife flew to England to meet
X. Agreeing to meet X was difficult for petitioner wife, espe-
cially because her husband’s arrest had taken its toll on their
marriage.
  I was about 20 pounds less. I was scared. I was nervous. * * * It was
  obviously very important that I do a good job. So, I had to fly by myself.
  Agents didn’t fly with me, so I went to * * *. Obviously, I was in very
  bad shape, because I had to deal with * * * [petitioner husband’s arrest]
  situation.

   Petitioner wife arrived in England the day before her
scheduled meeting with X. She met with Federal agents who,
after checking her hotel room for ‘‘bugs’’, discussed her
upcoming meeting with X. After speaking with the agents,
she walked with them to the meeting place, a popular hotel
lounge. Petitioner wife was informed that approximately 10
American and British agents would be in the lounge during
the meeting. Petitioner wife and the agents next went to the
U.S. Embassy, where she was instructed to leave the lounge
if she believed something was amiss. Petitioner wife spent
the remainder of the day rehearsing what she would say to
X. Specifically, she needed to explain how the plan would
work, state that the $1.2 million came from embezzled money
and that petitioners had not paid tax on that money, tell X
about the beneficial owner, and make arrangements for X to
meet the beneficial owner at another meeting.
   On the morning of the meeting, the Federal agents
attached a recording device to petitioner wife and placed a
backup recorder in her purse. Petitioner wife then went to
the lounge and waited for X to arrive. When X arrived 10 to
15 minutes later, he and petitioner wife conversed in a for-
eign language. Over the course of an hour, petitioner wife
was able to complete her talking points and record the
incriminating conversation. After the meeting, petitioner wife
flew to Philadelphia and spent several days reviewing the
English translation of the transcript of her conversation with
X to ensure accuracy.
   For several weeks no one heard from X. The Government
agents began to be concerned that, as petitioner husband put
it, X ‘‘got totally cold feet.’’ By this point, the Government
agents had come to trust petitioner husband. Petitioner hus-
band’s passport was returned to him, and he flew, alone, to
296         144 UNITED STATES TAX COURT REPORTS                      (290)


the Cayman Islands to meet X in order to ‘‘rein him back in’’.
Petitioner husband and X met, and X agreed to meet the
beneficial owner.
   Petitioner wife again traveled to England to meet X. She
followed the same procedure as in the first meeting. The
same two types of recording devices were planted on her, and
she met X at the same lounge as in the first meeting.
   Petitioner wife entered contact information with respect to
the beneficial owner in her cellular telephone before her
second meeting with X because
 the plan was that I arrive a little early, have a little warmup talk with
 * * * [X], and then I would get a phone call from * * * [the beneficial
 owner] and I would say ‘‘Oh, he’s coming,’’ and even show it in the phone
 and, you know, make it very real.

    When the would-be beneficial owner arrived, he and X had
an immediate rapport. The beneficial owner’s backstory had
been designed to appeal to X’s interests. Importantly, both
the beneficial owner and X were triathletes. X mentioned
that a triathlon in the Bahamas was upcoming and that he
and the beneficial owner should compete together. They ulti-
mately discussed the movement of the $1.2 million to a new
bank account, the fact that the $1.2 million came from
embezzled money, and that petitioners had not paid tax on
it.
    Unfortunately, neither the recording device worn by peti-
tioner wife nor the one in her purse worked; therefore, the
incriminating conversation with X was not recorded. Con-
sequently, over a period of two months, petitioner husband
called X in an effort to get him to make incriminating state-
ments. Eventually, petitioner husband got two recordings in
which X discussed the fact that the $1.2 million came from
embezzled money, that petitioners had not paid tax on it,
and that X would assist in the movement of the $1.2 million
to a new bank account. Petitioner husband was concerned
that X would realize something was amiss, given the efforts
made to convince him to say certain things (i.e., ‘‘embezzle-
ment’’ and ‘‘untaxed’’), but petitioner husband’s fears proved
unfounded.
    The next step was to draw X to the United States. Since
X had been instructed by the Targeted Business to avoid
entering the United States, a certain amount of enticement
(290)   WHISTLEBLOWER 21276–13W v. COMMISSIONER             297


was necessary. Petitioner husband contacted X and convinced
him to fly to Florida to meet the beneficial owner before trav-
eling to the triathlon in the Bahamas. He told X that the
beneficial owner would give him $15,000 in cash as a down-
payment when they met. X agreed to fly to Florida where he
was arrested.
    After a week in custody, X agreed to assist the Govern-
ment agents in their pursuit of the Targeted Business. X’s
arrest was kept quiet so as not to alert the Targeted Busi-
ness; eventually he was released and permitted to return
abroad. Upon his return, X informed one of the Targeted
Business’ owners that he had been arrested in the United
States and that he needed help. When the Government
agents learned of X’s betrayal, they directed petitioner hus-
band to convince X to follow through on his commitment.
    Petitioner husband persuaded X to meet him. Petitioner
husband appealed to X’s avariciousness by telling him that
their meeting was necessary to resolve a number of issues
with clients that affected payments to be made to X. Their
meeting was tense. Petitioner husband bluntly laid out X’s
situation. He told X that if he did not cooperate with U.S.
authorities, he would be unable to travel internationally for
the rest of his life, because ‘‘as soon as you jump over the
water, they get you.’’ Petitioner husband used himself as an
example of the benefits of cooperation. He explained that the
Government agents kept their word, and he warned X that
‘‘[i]f you screw them, you’re screwed’’. Ultimately X agreed to
cooperate with the Federal authorities.
    After X began cooperating with the Government agents, a
U.S. attorney’s office opened a criminal investigation of the
Targeted Business. Often when X provided prosecutors with
information, petitioner husband would be asked to confirm
its accuracy. During this time petitioner husband met the
assistant U.S. attorney leading the case, along with FBI and
IRS agents, to discuss the organization and operation of the
Targeted Business.
    The Targeted Business was indicted, with a subsequent
superseding indictment, for conspiring with U.S. taxpayers
and others to hide more than $1.2 billion in secret accounts,
and the income generated therefrom, from the IRS. The Tar-
geted Business pleaded guilty, as petitioner husband pre-
298         144 UNITED STATES TAX COURT REPORTS                      (290)


dicted. As part of its guilty plea, the Targeted Business paid
the United States approximately $74 million.
   Petitioner husband received an email from the lead FBI
agent stating ‘‘GREAT JOB’’ with a copy of the indictment
attached. Another agent called petitioners to congratulate
them. In an attachment to the stipulation of facts filed with
this Court, both the lead FBI agent and the assistant U.S.
attorney leading the case against the Targeted Business were
effusive in their praise of both petitioners, stating:
 The assistance and support of * * * [petitioners] in supporting the
 investigation was exceptionally helpful * * * In short, but for the work,
 information, and effort of * * * [petitioners] in assisting the federal
 government, the government’s successful action against * * * [the Tar-
 geted Business], as it was carried out, would not have been possible.
 * * * The information provided by the whistleblower [sic] was essential
 and substantially contributed to the government’s actions against * * *
 [the Targeted Business] that led to the collection of $74,131,694.42.

The IRS was involved in the pursuit of the Targeted Busi-
ness from the beginning of the investigation. At the partial
trial before this Court, the IRS special agent involved in the
investigation of the Targeted Business testified that peti-
tioner husband’s cooperation had been essential and the
agent acknowledged that there was no ‘‘Plan B’’ for the IRS
to pursue the Targeted Business.
VI. Petitioners’ Claims for Award
   Petitioners were unaware of any whistleblower award pro-
gram when they began to assist the Government in its pur-
suit of the Targeted Business. During one of petitioner hus-
band’s meetings with FBI, ICE, and IRS agents, one of the
agents mentioned that the IRS had a whistleblower award
program. Petitioner husband’s attorney contacted several of
the agents involved, inquiring whether they would object to
petitioners’ filing claims for award. No one objected to the
filing of such claims.
   On or about April 16, 2013, petitioners each submitted a
Form 211 to the Whistleblower Office. The Whistleblower
Office mailed petitioners separate letters on May 7, 2013,
notifying them that their Forms 211 had been received and
were assigned claim numbers. On or about June 17, 2013,
the Whistleblower Office sent petitioners separate letters
(290)     WHISTLEBLOWER 21276–13W v. COMMISSIONER                      299


stating that their claims remained open and were under
active consideration.
   Upon receipt, petitioners’ Forms 211 were sent to the IRS
Service Center in Ogden, Utah, for processing. Upon arrival,
a Form 211 is reviewed by a clerk who verifies the taxpayer’s
name and the whistleblower’s name, address, and Social
Security number and confirms that it includes an original
signature. The form is then entered into the system and for-
warded to a ‘‘classifier’’ to analyze the whistleblower’s allega-
tions and determine whether the application should be
accepted for substantive review by an operating division of
the IRS or rejected summarily. In the instant matter, the
classifier noted that proceeds had been collected from the
Targeted Business before petitioners filed their respective
Forms 211. On that basis, the classifier rejected petitioners’
applications. The classifier sent a Form 211 Classification
Checksheet for each petitioner’s claim to Cindy Wilde, a team
manager in the IRS Ogden Service center. The checksheet
includes a number of unexplained coded categories. The
checksheet stated: ‘‘Foreign [entity]—no US tax returns
filed—claim is based on information previously provided to
US Justice Dept which resulted in settlement agreement in
US District court case–claim was filed after the settlement
was reached and is therefore ineligible for reward’’. The
checksheet then stated ‘‘Results from Classification: L–1010’’,
which was the code instructing the IRS to send rejection let-
ters to petitioners. The checksheet did not explain the
rationale for the conclusion stated.
   Upon receipt of the Form 211 Classification Checklist, Ms.
Wilde noted the L–1010 designation and directed a clerk to
generate award determination letters denying petitioners’
claims. She did not review any other portion of the checklist.
Identical letters to petitioners stated:
  We have considered your application for an award dated 04/10/2013.
  Under Internal Revenue Code Section 7623, an award may be paid only
  if the information provided results in the collection of additional tax,
  penalties, interest or other proceeds. In this case, the information you
  provided did not result in the collection of any proceeds. Therefore, you
  are not eligible for an award.
  Although the information you submitted did not qualify for an award,
  thank you for your interests in the administration of the internal rev-
  enue laws.
300             144 UNITED STATES TAX COURT REPORTS                   (290)

  If you have any further questions in regards to this letter, please feel
  free to contact the Informant Claims Examination Team at 801–620–
  2169.

The letters did not address the facts and circumstances of
petitioners’ applications or mention the perceived timing
issue. Indeed, apart from the date, each letter consisted of
boilerplate language taken from an example letter in the
Internal Revenue Manual. No further action was taken by
the Whistleblower Office. 3
   On or about August 13, 2013, the IRS sent petitioners the
separate award determination letters denying their respec-
tive claims for award. Petitioners appealed those determina-
tions to this Court, pursuant to section 7623(b)(4), on Sep-
tember 12, 2013.

                               Discussion
I. Introduction
  The only issue we decide herein is whether petitioners
were required as a matter of law to file Forms 211 with the
Whistleblower Office before providing information to the IRS
to qualify for an award under section 7623(b). We hold they
were not.
II. Rejection of Petitioners’ Requests for Award as Untimely
  A. Respondent’s Argument
   Petitioners filed their respective Forms 211 three months
after the Targeted Business pleaded guilty. According to
respondent, information petitioners gave to the IRS special
agent before filing their Forms 211 is not ‘‘information
brought to the Secretary’s attention’’ (whistleblower informa-
tion) for which petitioners can receive awards under section
7623(b). Respondent concedes that section 7623(b) does not
specifically include a timing requirement regarding when
  3 Generally a Form 11369, Confidential Evaluation Report on Claim for
Award, is included in the administrative file. The form is prepared for the
Whistleblower Office by the IRS operating division that reviews the appli-
cation and allows the Whistleblower Office to evaluate the merits of the
claim before making a final determination. Because petitioners’ applica-
tions were rejected on the grounds that the Forms 211 were filed late, no
such review was made, no Form 11369 was generated, and no Whistle-
blower Office analyst reviewed the claim.
(290)   WHISTLEBLOWER 21276–13W v. COMMISSIONER             301


whistleblower information must be submitted to the Whistle-
blower Office. But citing the Tax Relief and Health Care Act
of 2006, Pub. L. No. 109–432, div. A, sec. 406(b), 120 Stat.
at 2959 (TRHCA sec. 406), which established the Whistle-
blower Office, respondent argues that the Whistleblower
Office is the ‘‘gatekeeper of information for purposes of non-
discretionary awards under amended section 7623(b).’’ And
respondent asserts that to be eligible for an award under sec-
tion 7623(b), an individual must submit the whistleblower
information to the Whistleblower Office on Form 211 before
any IRS action or examination is carried out with respect to
that information.
  B. Whistleblower Statute Background
   Before its amendment in 2006, section 7623 authorized the
Secretary to pay ‘‘such sums as he deems necessary for—(1)
detecting underpayments of tax, and (2) detecting and
bringing to trial and punishment persons guilty of violating
the internal revenue laws or conniving at the same’’. The
regulations promulgated thereunder provided that IRS dis-
trict and/or service center directors have authority to approve
awards ‘‘in a suitable amount, for information that leads to
the detection of underpayments of tax, or the detection and
bringing to trial and punishment of persons guilty of vio-
lating the internal revenue laws or conniving at the same.’’
Sec. 301.7623–1(a), Proced. & Admin. Regs. The regulations
further provided that the ‘‘amount of a reward will represent
what the district or service center director deems to be ade-
quate compensation in the particular case.’’ Id. para. (c); see
Michelle M. Kwon, ‘‘Whistling Dixie About the IRS Whistle-
blower Program Thanks to the IRC Confidentiality Restric-
tions’’, 29 Va. Tax Rev. 447, 452 (2010).
   In 2006 the Treasury Inspector General for Tax Adminis-
tration (TIGTA) reviewed the whistleblower award program
and filed a report entitled ‘‘Treasury Inspector General for
Tax Administration Report 2006–30–092, The Informants’
Reward Program Needs More Centralized Management
Oversight (June 2006)’’ (TIGTA Report). The TIGTA Report
found that the whistleblower award program had signifi-
cantly contributed to the IRS’ enforcement efforts and that
examinations based on informant information were often
more effective and efficient than examinations initiated using
302         144 UNITED STATES TAX COURT REPORTS                   (290)


the IRS’ primary method for selecting returns for examina-
tion. TIGTA Report at 1–2. However, the TIGTA Report
found that the whistleblower award program was weakened
by lack of standardized procedures and managerial oversight.
Specifically, the TIGTA Report stated there was no national
database of informant claims (instead there were five
regional databases, one for each of the five regional units),
and 45% of the case files reviewed suffered basic control fail-
ures, such as missing copies of forms and missing records of
letters sent to informants. The TIGTA Report further stated
that TIGTA was unable to determine (1) the justification for
the percentage amount awarded to the informants in 32% of
the cases reviewed and (2) the rationale for the decision to
reject the informant’s claim in 76% of the cases reviewed.
   The TIGTA Report found that the whistleblower award
program was replete with lengthy delays, averaging 71⁄2
years for an award to be paid to an informant. Id. at 2. The
TIGTA Report concluded that while part of this delay was a
result of the statute’s requirement that rewards be paid only
after the additional taxes, fines, and penalties had been col-
lected, the IRS failed to monitor taxpayers’ accounts for pay-
ment activity for periods longer than a year. The TIGTA
Report further concluded that award rejections took an
inordinate amount of time, and TIGTA could not determine
the reason for delays between the receipt of the whistle-
blower’s claim and review thereof. Id. at 8–9.
   The TIGTA Report made two primary recommendations:
first, that the IRS centralize management of the whistle-
blower award program and standardize processing of award
claims; and second, that a detailed nationwide database of
informant claims be developed and implemented. Id. at 9.
  C. The 2006 Amendment and Section 7623(b)
  In 2006 Congress enacted TRHCA to strengthen the IRS
whistleblower award program. TRHCA sec. 406(b), an
uncodified provision, established the IRS Whistleblower
Office to administer the whistleblower award program.
TRHCA sec. 406(b) provides:
   (1) IN GENERAL.—Not later than the date which is 12 months after the
 date of the enactment of this Act, the Secretary of the Treasury shall
 issue guidance for the operation of a whistleblower program to be
(290)     WHISTLEBLOWER 21276–13W v. COMMISSIONER                       303


  administered in the Internal Revenue Service by an office to be known
  as the ‘‘Whistleblower Office’’ which—
     (A) shall at all times operate at the direction of the Commissioner of
  Internal Revenue and coordinate and consult with other divisions in the
  Internal Revenue Service as directed by the Commissioner of Internal
  Revenue,
     (B) shall analyze information received from any individual described
  in section 7623(b) of the Internal Revenue Code of 1986 and either inves-
  tigate the matter itself or assign it to the appropriate Internal Revenue
  Service office, and
     (C) in its sole discretion, may ask for additional assistance from such
  individual or any legal representative of such individual.
     (2) REQUEST FOR ASSISTANCE.—The guidance issued under paragraph
  (1) shall specify that any assistance requested under paragraph (1)(C)
  shall be under the direction and control of the Whistleblower Office or
  the office assigned to investigate the matter under paragraph (1)(A). No
  individual or legal representative whose assistance is so requested may
  by reason of such request represent himself or herself as an employee
  of the Federal Government.

  D. Analysis
   Respondent argues the statutory provisions make clear
that Congress intended the Whistleblower Office to serve as
the gatekeeper of whistleblower information. According to
respondent, the Whistleblower Office is able to maintain the
discretion granted it by TRHCA sec. 406(b)(1)(B) to inves-
tigate the matter or assign it to an appropriate IRS office
only if the whistleblower information is first provided to it.
Similarly, respondent maintains that the discretion granted
to the Whistleblower Office by TRHCA sec. 406(b)(1)(C) to
ask for assistance from the whistleblower would be jeopard-
ized if it did not first receive the information. Respondent
posits that this interpretation is consistent with the conclu-
sions of the TIGTA Report emphasizing the need for central-
ized management of the whistleblower award program.
   Respondent’s position does not survive close scrutiny. As
the TIGTA Report noted, audits under the old whistleblower
award program were effective; it was the process by which
awards were issued that was problematic. TRHCA sec. 406
addresses this problem. It is clear from the statute that the
Whistleblower Office is charged with being the central office
for investigating the legitimacy of a whistleblower’s award
claim, not necessarily the underlying tax issue. To interpret
TRHCA sec. 406(b)(1)(B) as respondent does would mean the
Whistleblower Office is authorized to open an examination
304        144 UNITED STATES TAX COURT REPORTS             (290)


relating to a taxpayer. But the Whistleblower Office has nei-
ther sufficient staff nor institutional expertise to investigate
taxpayers. See Internal Revenue Manual pt. 1.1.26.1 and
1.1.26.2 (June 8, 2010) (discussing the roles and mission of
the Whistleblower Office). And were the Whistleblower Office
to expand its staff and expertise sufficiently to conduct
examinations relating to taxpayers brought to its attention
by whistleblowers, such expansion would duplicate the
resources already available in IRS operating divisions.
   Moreover, if the Whistleblower Office opened an examina-
tion relating to a taxpayer, such an examination would alert
the taxpayer that an informant was involved and this would
potentially subject the whistleblower to exposure and retalia-
tion, directly contravening the IRS policy of protecting the
identities of informants. And we are loath to interpret a
statute in a manner that leads to an absurd result. See, e.g.,
United States v. Granderson, 511 U.S. 39, 47 n.5 (1994); In
re Chapman, 166 U.S. 661, 667 (1897).
   IRS auditors do not shy away from directly contacting
whistleblowers when in need of assistance. See, e.g., Whistle-
blower 10949–13W v. Commissioner, T.C. Memo. 2014–106,
at *3. Tellingly, at the partial trial of these cases, the IRS
agent testified that he would not suspend his investigation to
permit whistleblowers to file forms with the Whistleblower
Office.
   Despite respondent’s assertions, we are mindful that the
Forms 211 which petitioners filed anticipate that a whistle-
blower may approach an operating division of the IRS before
notifying the Whistleblower Office. See Form 211, line 8,
which instructs the whistleblower to provide the ‘‘Name &
Title of IRS employee to whom violation was reported’’, and
line 9, which asks for the ‘‘Date violation reported’’.
   Form 211 was revised in March 2014. It was not, and
never has been, altered to discourage whistleblowers from
approaching an operating division of the IRS. To the con-
trary, revised Form 211 expands the detail about a whistle-
blower’s directly contacting investigating agencies before con-
tacting the Whistleblower Office, including providing space
for the whistleblower to report any information submitted to
other Federal agencies as well as State authorities. See Form
211, line 5, which instructs the whistleblower to provide the
‘‘[n]ame and title and contact information of IRS employee to
(290)     WHISTLEBLOWER 21276–13W v. COMMISSIONER                     305


whom violation was first reported, if known’’. See also line 6,
which instructs the whistleblower to provide ‘‘[d]ate violation
reported (in number 5), if applicable’’. And line 7 asks: ‘‘Did
you submit this information to other Federal or State Agen-
cies’’? And line 8, which states: ‘‘If yes in number 7, list the
Agency Name and date submitted’’. If respondent’s position
were correct, these lines would be superfluous; in fact, they
would be misleading to an unwary whistleblower.
   Respondent also argues that the Whistleblower Office must
first receive a whistleblower’s information in order to permit
Form 11369 to be filled out. Respondent maintains:
  The Form 11369 is the key document used by the Whistleblower Office
  in making the determinations required by section 7623 and only is cre-
  ated on a contemporaneous basis when information is referred by the
  Whistleblower Office. Thus, allowing individuals to file an award claim
  based on information previously submitted to a different function of the
  IRS would circumvent the centralized oversight and management of the
  program that was mandated by congress when section 7623(b) was
  enacted and undermine the Whistleblower Office’s ability to make well-
  supported determinations.

   In considering respondent’s argument, we have reviewed
Form 11369. The form allows an IRS operating division to
inform the Whistleblower Office of each issue raised by the
whistleblower, the disposition of that issue (i.e., whether the
issue was pursued), and the level of assistance the whistle-
blower provided. Upon examination of the form, we do not
believe it must be completed contemporaneously with a tax-
payer-related examination. There is no reason for the contact
information provided by Form 211 lines 5 and 6, other than
for it to be used by the Whistleblower Office to contact the
IRS employee who received the whistleblower information.
And there is no reason for the Whistleblower Office to con-
tact the IRS employee except when evaluating the whistle-
blower’s claim.
   Finally, even if respondent’s contention that the Whistle-
blower Office is authorized by TRHCA sec. 406 to conduct
examinations relating to taxpayers is correct, the statute
does not mandate that a whistleblower first bring his/her
information to the Whistleblower Office to be eligible for an
award. TRHCA sec. 406(b)(B) provides only that the Whistle-
blower Office shall ‘‘analyze information received’’ and
‘‘either investigate the matter itself or assign it to the appro-
306        144 UNITED STATES TAX COURT REPORTS           (290)


priate Internal Revenue Service office.’’ The statute makes no
mention of the Whistleblower Office’s being the first IRS
office to receive information, and, as a practical matter,
nothing prevents the Whistleblower Office from pursuing the
whistleblower’s information even after another IRS office
receives it.
III. Conclusion
  On November 5, 2014, respondent filed a motion in limine,
requesting the Court to confine its review to the issue of
timing. Respondent asserts that the Court should apply an
abuse of discretion standard of review and, if the Court finds
the Whistleblower Office improperly denied petitioners’
claims for award on the basis that the claims were untimely
submitted, the cases should be remanded to the Whistle-
blower Office for further consideration. The parties did not
fully explore the standard of review to be used in whistle-
blower cases. And because it is not necessary for us to
address the standard of review in resolving the timing issue,
we will not do so. Respondent’s motion in limine will be
denied.
  Because it rejected petitioners’ claims as untimely, the
Whistleblower Office did not conduct a review, investigation,
or evaluation of the merits of petitioners’ claims for award.
We believe the parties should have an opportunity to resolve
these cases on the basis of our holding herein. We will
require them to file a status report in accordance with an
order to be issued.
  In the light of the foregoing,
                          An appropriate order will be issued.

                        f
