411 for 211

Today TaxMama hears from Ed in California, who wants to know, “If I turn in my employer with the IRS form 211 will I get audited too?”

Dear Ed,

It all depends why you’re reporting your employer.

If your employer is doing something illegal that affects the way he’s paying income to his employees, odds are pretty good that the employees will be affected, too.

Other than that, you’re not apt to get audited for simply turning him in.

Since the Form 211 is a request for a reward for turning him in, you have something to gain from taking this action. So, remember, you might just get sued.
http://www.irs.gov/pub/irs-pdf/f211.pdf

Even though the 211 is supposed to remain confidential, and IRS is bound by law not to reveal the identity of an informant, I can imagine that an aggressive attorney can insist on seeing it so his client can face his accuser. It’s his constitutional right.

Have you ever read the 6th Amendment to the constitution?
http://www.law.cornell.edu/constitution/constitution.billofrights.html

Of course, that doesn’t mean they will win their case to get your identity. But, they just might…

So, if you don’t want to face a lawsuit, file that Form 211 anonymously and skip the potential reward. Provide enough specific information about your boss’s illegal activities so IRS can follow the money trail – Social Security numbers, address, bank account numbers, specific assets purchased with cash, and such things.

Or have a trusted intermediary provide the information to IRS on your behalf. There’s an interesting article at WhosARat.com by Jeff Schnepper of MoneyCentral http://www.whosarat.com/news_detail.php?nid=2 .

Regardless, think twice before doing something like this. But if you’re sure he’s breaking the law – and you’re not just trying to cause trouble because you’re angry with him about some personal affront – go for it.

.Remember, you’ll find answers to questions about rewards and all kinds of tax issues, free. Where? Where else? At TaxMama.com

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