Bipartisan IRS whistleblower reform bill gains momentum in Senate after House approval

A bipartisan Senate duo recently introduced companion legislation to a House-passed bill that would make several reforms to an IRS whistleblower program that has recovered billions from noncompliant taxpayers. 

“The IRS Whistleblower Awards Program demonstrates the power of whistleblowers. These patriotic men and women are critical to preventing tax dodgers and fraudsters from cheating the American tax system,” said Sen. Chuck Grassley, R-Iowa, the measure’s sponsor, in a statement to Government Executive. “Our bipartisan legislation strengthens protections and support for whistleblowers so this program can keep improving compliance and fairness in our tax system.”

Like its House counterpart (H.R. 7959), the IRS Whistleblower Program Improvement Act (S. 4639) would:

• Modify the standard for reviewing whistleblower award determinations in the U.S. Tax Court in order to allow new evidence to be introduced during appeal.   
• Permit whistleblowers to be anonymous before the Tax Court, unless there is a “societal interest” in disclosing their identity.
• Require interest on certain whistleblower payments if the IRS does not meet the deadline to inform the individual of an award recommendation, as part of an effort to ensure the tax agency distributes payments in a timely manner. 

In 2025, the IRS reported that it has collected about $7.5 billion as a result of protected disclosures since 2007, leading to more than $1.3 billion in awards to whistleblowers. According to the tax agency, payments tend to be 15 to 30% of funds received due to the whistleblower’s information. 

“The numbers show that the IRS whistleblower program works, so the Senate ought to look for every opportunity to improve it,” said Sen. Ron Wyden, D-Ore., the bill's cosponsor, in a statement to Government Executive. “It takes real courage to blow the whistle and help put an end to illegal tax cheating schemes, and our bill will go a long way to protecting Americans who bravely speak out.”

Grassley and Wyden are the co-founders and co-chairs of the Senate Whistleblower Protection Caucus. Their legislation is supported by the National Whistleblower Center and Taxpayers Against Fraud nonprofits. 

The House in April passed its version of the bill in a 346-10 vote. Provisions that are identical to the legislation are also in the bipartisan Taxpayer Assistance and Service Act (S. 3931), which Wyden cosponsored. That measure has not yet been voted on.