The Internal Revenue Service is asking for whistleblowers to report misuse, diversion or fraudulent use of federal funds by tax-exempt organizations, individuals and businesses.
The IRS issued a
"Whistleblower Alerts are a new way for the IRS to spotlight high-risk areas and reach people who may have direct knowledge of noncompliance," said IRS CEO Frank Bisignano in a statement. "We are expanding how we identify potential fraud, and these alerts will help connect us with individuals who can provide credible, timely information."
The IRS listed the following examples in the alert:
- False statements or misrepresentations in grant applications;
- Misuse of federal funds and grants including the diversion of funds for personal use;
- Self-dealing or undisclosed conflicts of interest;
- Improper payments to insiders, officers or related parties;
- Failure to perform required services or deliver promised outcomes;
- Falsified reporting to federal agencies;
- Misclassification of activities to maintain tax-exempt status;
- Any other tax-exempt organization misconduct such as tax fraud, money laundering or operating for non-exempt purposes;
- Other criminal or suspicious behavior.
The IRS Whistleblower Program provides monetary awards of up to 30% of the proceeds collected based on whistleblower-provided information. The agency is encouraging whistleblowers to report specific, timely and credible information about noncompliance with tax laws or other laws the IRS is authorized to administer. Whistleblowers can
Earlier this week, during a
"It's long been my view that the IRS needs to do a better job of targeting bad actors to avoid imposing costly audits on innocent taxpayers," he said. "A program that I have championed to do just that is the IRS Whistleblower Program, which incentivizes those with knowledge of high-dollar tax evasion to alert the IRS. To date, this program has brought in over $7 billion to the Treasury and could raise billions more if used by the IRS to its full potential."
He asked Bisignano if the IRS will be putting more emphasis going forward on the IRS Whistleblower Program to further focus IRS audit resources.
Bisignano indicated that he would, "I have an open door policy and streamline the IRS so that we can communicate better than ever before," he said. "I hope any IRS employee utilizes the resources they have to communicate issues they see to me or any form of leadership or wherever they feel appropriate. We like to hear from people. We understand whistleblowers are usually important to our system here."
Grassley noted that he has seen resistance over the years within the IRS to the Whistleblower Program.
"I get a feeling, after all these years that this has been on the books, even though it's brought in $7 billion, that there's people in the bowels of the IRS that don't like it," said Grassley. "And I think we've got to overcome that bureaucratic opposition to people outside reporting that the IRS isn't doing their job. "
Bisignano pledged to do everything in his power to support the program.
The IRS and the Federal Bureau of Investigation
During the hearing, Bisignano was asked by Sen. Raphael Warnock, D-Georgia, about President Trump's calls for the IRS to investigate Harvard and other universities and nonprofits such as Citizens for Responsibility and Ethics in Washington.
"The Trump administration has repeatedly attempted to weaponize the IRS against its political opponents, which would potentially violate the First Amendment," said Warnock. "In April and May of 2025, President Trump threatened to revoke the tax-exempt status of Harvard University for political reasons. In a September memo, President Trump directed the IRS to investigate tax-exempt entities over their alleged ties to what he considers political violence and domestic terrorism. In December, the IRS and the FBI created a task force to execute the President's directive."
Warnock asked Bisignano how many IRS agents have been detailed to the Department of Justice, and Bisignano replied he believed it was 15.
"If you look at the people within IRS that work on these type of items, they sit with an enforcement group and 70% of the time it's on IRS tax-related items ... and 30% of the time they're asked to work on other things," said Bisignano. "The Brown University murderer was found by these type of agents. It's not an unusual item where we go work with the FBI to solve problems."
Warnock then asked a series of questions about whether the president, vice president or any White House staff or the Treasury Secretary had requested that the IRS audit, prosecute or investigate any particular taxpayer or entity. Bisignano replied no. Warnock asked him if such an unlawful conversation ever occurred, would he immediately report that to Congress, including all members of the committee, and Bisignano replied yes. He also asked about what would happen if President Trump theoretically ordered the IRS to audit the ACLU or the NAACP in a social media post, and whether he would ignore such a request. Bisignano said he would. Warnock also cited Trump's calls for revoking CREW's tax-exempt status and JD Vance's threats to tax the Ford Foundation before he was elected vice president.
"Last year, the president said in the Oval Office that he was looking into a nonprofit's tax-exempt status, so these aren't theoretical questions I'm asking," said Warnock. "He said that he was looking into a nonprofit's tax-exempt status, Citizens for Responsibility and Ethics, for going after Donald Trump. These are the president's words. Based on your answers, can you confirm that the IRS never acted on the president's statements?"
Bisignano confirmed that he never acted on those requests, nor have Trump's criticisms of environmental activist groups led to an IRS investigation.
