T.C. Memo. 2017-128
UNITED STATES TAX COURT
KENNETH WILLIAM KASPER, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 6748-13W. Filed June 29, 2017.
Kenneth William Kasper, pro se.
Rachel G. Borden and Patricia P. Davis, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
NEGA, Judge: Petitioner commenced this whistleblower proceeding
pursuant to section 7623(b)(4).1 The issue for decision is whether petitioner
1
Unless otherwise indicated, all section references are to the Internal
Revenue Code in effect at all relevant times.
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[*2] satisfies the threshold requirements for a whistleblower award under section
7623(b), thereby being entitled to relief.
FINDINGS OF FACT
Some of the facts are stipulated and are so found. The stipulation of facts
and the attached exhibits are incorporated herein by this reference. Petitioner
resided in Arizona when the petition was filed.
On December 6, 2012, petitioner filed with the Internal Revenue Service
Whistleblower Office (Whistleblower Office) a Form 211, Application for Award
for Original Information (whistleblower claim), and a Form 13909, Tax-Exempt
Organization Complaint (Referral).2 On March 6, 2013, the Whistleblower Office
sent petitioner a letter (2013 letter) denying his whistleblower claim and stating in
pertinent part that “[w]e have considered your application for an award”, “the
information you provided did not result in the collection of any proceeds”, and
“you are not eligible for an award”. On March 25, 2013, petitioner timely filed a
petition in this Court under section 7623(b)(4) with regard to the determination set
forth in the 2013 letter. Petitioner requests that the Whistleblower Office’s
determination regarding his whistleblower claim be held in abeyance until the
2
We omit the substance of petitioner’s whistleblower claim because it is not
necessary to our decision herein.
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[*3] Whistleblower Office considers the information submitted on both Form 211
and Form 13909.
On June 11, 2013, the Whistleblower Office sent petitioner a letter notifying
him that the 2013 letter had been sent in error and that the Whistleblower Office
was still considering his whistleblower claim. On March 2, 2015, the
Whistleblower Office sent petitioner another letter denying his whistleblower
claim and stating in pertinent part that “[w]e have now completed our
consideration of your application for an award”, “the information you provided did
not result in the collection of any proceeds”, and “you are not eligible for an
award”. At no time did the Whistleblower Office initiate an administrative or
judicial action using the information in petitioner’s whistleblower claim or collect
any tax proceeds from the target taxpayer.
OPINION
The Tax Court is a court of limited jurisdiction and may exercise its
jurisdiction only to the extent authorized by Congress. Sec. 7442; Naftel v.
Commissioner, 85 T.C. 527, 529 (1985). Section 7623(b)(4) provides us with
jurisdiction in a whistleblower action with respect to “[a]ny determination
regarding an award under paragraph (1), (2), or (3)” (including a determination to
deny an award) if a petition invoking our jurisdiction over that matter is timely
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[*4] filed. See Whistleblower 14106-10W v. Commissioner, 137 T.C. 183, 186-
187 (2011); Kasper v. Commissioner, 137 T.C. 37, 41 (2011). The 2013 letter
contains a determination for purposes of section 7623(b)(4), and petitioner timely
filed his petition. See Cooper v. Commissioner, 135 T.C. 70, 75-76 (2010)
(stating that this Court has jurisdiction under section 7623 with regard to a letter
where, as here, the letter was a final administrative decision because it stated that
the applicant was not entitled to an award and provided an explanation for that
conclusion); see also Ringo v. Commissioner, 143 T.C. 297, 300 (2014); Kasper v.
Commissioner, 137 T.C. at 41.
Generally, an individual who provides information that leads the
Commissioner to proceed with an administrative or judicial action and that results
in the collection of proceeds shall receive an award equal to a percentage of the
collected proceeds. See sec. 7623(b)(1). A whistleblower award depends upon
both initiation of an administrative or judicial action and collection of tax
proceeds. Cooper v. Commissioner, 136 T.C. 597, 600 (2011). Section
7623(b)(4), which provides our jurisdiction, does not contemplate that we review
the Commissioner’s determination of the alleged tax liability to which the claim
pertains, nor does section 7623 confer authority to direct the Commissioner to
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[*5] commence an administrative or judicial action. Cooper v. Commissioner, 136
T.C. at 600.
The Whistleblower Office completed its consideration of petitioner’s
whistleblower claim, and at no time did it initiate an administrative or judicial
action or collect any tax proceeds from the target taxpayer. Accordingly, the
section 7623(b) threshold requirements have not been met, and petitioner is not
entitled to relief regarding the determination set forth in the 2013 letter.
To reflect the foregoing,
Decision will be entered
for respondent.