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Category Archives: Tax Justice for Whistleblowers

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New IRS regulation is no help to whistleblowers

Posted in Tax Justice for Whistleblowers
On January 23, 2012, the Internal Revenue Service (IRS) issued a final regulation that reflects a 1996 law making payments for emotional distress damages taxable as income. The new regulation, cited as 26 CFR 1.104-1(c), makes clear that settlements and awards are taxable unless they are "attributable to a physical injury or physical sickness." The regulation also restates an exclusion … Continue Reading

Civil Rights Tax Relief Act introduced in House and Senate

Posted in Legislation, Tax Justice for Whistleblowers
Representatives John Lewis (D-GA) and James Sensenbrenner (R-WI) introduced the Civil Rights Tax Relief Act in 2009. This bill would provide that compensatory damages awarded in whistleblower and other cases would be excluded from the definition of “income” for income tax purposes, just as other personal injuries are excluded. The Civil Rights Tax Relief Act will also permit whistleblowers and … Continue Reading

Whistleblower faces tax penalty for misreporting qui tam reward

Posted in Tax Justice for Whistleblowers
Albert D. Campbell worked for Lockheed Martin from 1981 to 1995. He worked as a financial analyst, and was promoted in 1989 to chief of cost control for the $3.5 billion LANTIRN project. The LANTIRN project built navigation and targeting pods for fighter jets. Between 1993 and 1995, Campbell used sophisticated analytic exercises to show that LANTIRN was wasting millions … Continue Reading

IRS rule to clarify taxation of personal injury compensation

Posted in Tax Justice for Whistleblowers
The Internal Revenue Service (IRS) is now considering a proposed regulation that would expand the types of personal injury compensations that are exempt from income tax.  The proposed rule would eliminate the requirement that compensation be paid as part of a tort remedy.  However, the proposed rule would not go so far as to make clear that compensation for enduring … Continue Reading

Iowa State Representative Speaks Out Against the Murphy Decision

Posted in Tax Justice for Whistleblowers
Back in April, when the Supreme Court denied certiorari for Murphy v. IRS, a lot of people were upset. Whistleblowers and other civil rights leaders knew that the DC Court of Appeals’ terrible opinion (ruling that the 16th Amendment of the Constitution gives government the power to tax court-awarded compensatory damages as if they were income) was a slap in the face to victims of discrimination. … Continue Reading

Supreme Court Denies Cert in Murphy v. IRS

Posted in Tax Justice for Whistleblowers
In an order posted today on the its website, the U.S. Supreme Court announced that it will not be hearing the Murphy v. IRS appeal. Although this is a disappointing turn of events, whistleblower and civil rights advocates should continue the fight for tax justice, both in other judicial venues, and in the halls of Congress.   In response to the news, the … Continue Reading

Reply Brief Filed in Whistleblower Tax Case, Murphy v. IRS

Posted in Tax Justice for Whistleblowers
Attorneys working with the National Whistleblower Center have filed the reply brief in response to the Solicitor General’s brief regarding whether certiorari should be granted in a key Whistleblower/Civil Rights tax case that was filed with the Supreme Court by attorneys. The case is Murphy v. IRS, No. 07-802 (Supreme Court). Click here to view the brief (PDF)>>> The principal … Continue Reading

Government Reply Brief Filed with Supreme Court in Murphy v. IRS

Posted in Tax Justice for Whistleblowers
The Solicitor General has filed the Government’s brief in opposition to the granting of certiorari in a key Whistleblower/Civil Rights tax case that was filed with the Supreme Court by attorneys working with the National Whistleblower Center.  The case is Murphy v. IRS, No. 07-802 (Supreme Court). The principal issue is whether the IRS can tax as “income” plaintiffs’ court … Continue Reading

Update on Whistleblower Tax Case, Murphy v. IRS

Posted in Government Whistleblowers, News, Tax Justice for Whistleblowers
Last month we reported on a key Whistleblower/Civil Rights tax case that was filed with the Supreme Court by attorneys working with the National Whistleblower Center. See Whistleblowers Blog (December 13, 2007). The case is Murphy v. IRS, No. 07-802 (Supreme Court), and the principal issue is whether the IRS can tax as income plaintiffs’ court awards for non-physical compensatory … Continue Reading

Key Whistleblower Tax Case Filed in the Supreme Court

Posted in News, Tax Justice for Whistleblowers
The National Whistleblower Center announced today that a major Whistleblower/Civil Rights tax case has been filed with the Supreme Court. The case, Murphy v. IRS, has generated a lot of attention in the past year, and certainly puts forth questions that beg a grant of certiorari. At the heart of the case is whether the IRS has the constitutional right … Continue Reading