(Bloomberg) A whistleblower’s $6.8 million in awards must be taxed as ordinary income, a U.S. Tax Court judge ruled, rejecting arguments that the money should be recognized as capital gains and subject to a lower rate.

Craig Patrick, a former reimbursement manager for California medical device-maker Kyphon Inc., helped win the recovery of tens of millions of dollars for the U.S. from an alleged Medicare fraud and his efforts “are to be applauded and were rewarded,” Judge Diane Kroupa wrote in her ruling yesterday. “Rewards, however, are treated as ordinary income” and “subject to tax as such.”

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access