How to Report Tax Fraud to the IRS

According to a 2025 TIGTA report, the IRS prevented over $900 million in fraudulent refunds during the 2025 filing season alone. The IRS provides secure, confidential channels for reporting suspected fraud, and you may even qualify for a monetary reward through the Whistleblower Program.

"When individuals evade taxes, it can lead to reduced public funding for essential services and potentially higher tax rates for taxpayers," says David Kindness, CPA and Founder of Your Creative CPA. "Citizen reporting can act as a valuable defense mechanism against tax fraud, extending IRS enforcement reach and enhancing overall tax compliance."

This guide explains how to report suspected tax fraud, which forms to use, and what happens after you submit your report.

Key Takeaways

• Use IRS Form 3949-A to report suspected tax fraud; reports can be submitted anonymously to protect your privacy.

• The IRS Whistleblower Program pays 15-30% of recovered taxes for substantial fraud cases via Form 211.

• You can submit reports online, by mail, or using specialized forms for specific types of tax violations.

• Reporting fraud helps the IRS enforce tax laws and maintain tax system fairness.

What Is Tax Fraud?

Tax fraud involves deliberately deceiving the IRS to evade paying taxes that are legally owed. Unlike common tax errors that can be corrected, tax fraud requires fraudulent intent to avoid tax obligations.

The most common fraud types include understating cash income, intentionally understating capital gains, and manipulating financial statements to reduce tax burden. Red flags to watch for include "unusually large business losses to offset income, significant personal expenses run through a business, and a lifestyle that far exceeds reported income," notes Kindness.

Common Types of Tax Fraud to Report

Unreported Income Violations

• Cash business payments: Side businesses not reporting cash payments on tax returns.

• Hidden offshore income: Account income hidden from IRS reporting requirements.

• Omitted investment gains: Rental property income or investment gains are deliberately excluded from filings.

• Unreported contract work: Tips, commissions, or contract payments not included in tax calculations.

Fraudulent Deduction Schemes

• Fake business expenses: Claims for expenses without proper documentation or a legitimate business purpose.

• Personal expense deductions: Personal costs incorrectly deducted as business expenses, such as vacations claimed as business travel.

• Inflated charitable donations: Claims with fabricated receipts or inflated valuations.

• False medical deductions: Deductions for medical procedures never performed.

Document and Identity Fraud

• Stolen identification numbers: Using stolen Social Security numbers or taxpayer identification numbers.

• Counterfeit tax documents: Creating fake W-2s, 1099s, or other official tax documents.

• Multiple identity filings: Filing multiple returns under different identities.

• False dependent claims: Claiming dependents who don't meet IRS qualification requirements.

Which IRS Form Should You Use?

The IRS offers different forms depending on your reporting situation and whether you're seeking a financial reward. 

Form 3949-A: Information Referral

Best for: Standard tax fraud reporting without seeking monetary compensation.

Form 3949-A serves as the primary method for reporting suspected tax violations to the IRS. This form allows you to submit detailed information about individuals or businesses you suspect of tax fraud.

Key Features of Form 3949-A

• Anonymous submission: Can be filed without providing personal identifying information.

• Multiple submission methods: Available for online submission or mail delivery.

• Comprehensive coverage: Covers all major types of tax fraud and evasion.

• No feedback required: No expectation of IRS updates or case status reports.

Form 211: Whistleblower Application

Best for: Cases involving substantial unpaid taxes where you want potential financial rewards.

The IRS Whistleblower Program rewards individuals who provide specific, credible information leading to tax recovery. Awards range from 15-30% of collected amounts.

Whistleblower Program Requirements

• Substantial amounts: Must involve significant tax amounts, typically $2 million or more in tax, penalties, and interest.

• Contact information required: Requires your contact details, which the IRS keeps confidential.

• Detailed evidence needed: Need comprehensive documentation supporting fraud allegations.

• Extended timeline: The investigation and award process can take several years to complete.

While the IRS receives thousands of whistleblower submissions annually, only 100-150 claims per year result in awards, as most don't meet the stringent $2 million threshold or lead to successful collections.

Other Specialized Forms

• Form 14242: Abusive Tax Promoter Report: Use this form to report individuals or organizations promoting abusive tax schemes or selling fraudulent tax products.

• Forms 14157/14157-A: Tax Preparer Complaints: Report tax preparers who engage in fraudulent practices, including inflating deductions or promising guaranteed refunds.

How to Complete and Submit Form 3949-A

Form 3949-A requires specific information to help IRS investigators evaluate and pursue your fraud report effectively.

Required Information for Your Report

Suspected Violator Details

• Legal name and aliases: Full legal name and any known aliases or business names.

• Tax identification numbers: Social Security Number or Employer Identification Number, if available.

• Complete address: Full address including city, state, and ZIP code.

• Contact information: Phone numbers, email addresses, or website information.

Violation Description

• Type of fraud: Specific category of tax fraud suspected, such as unreported income or false deductions.

• Tax years affected: Specific tax years involved in the suspected violations.

• Dollar amounts: Estimated amounts of unreported income or fraudulent deductions.

• Source of knowledge: Explanation of how you became aware of the suspected fraud.

Supporting Evidence

• Documentation: Documents, photographs, or records that support your allegations.

• Witness information: Details about other sources or corroborating witnesses.

• Timeline details: Chronological sequence of events or patterns of fraudulent behavior.

• Previous reporting: Any history of prior reports or investigations.

Form 3949-A Submission Methods

• Online submission: The IRS provides a secure online portal for submitting Form 3949-A digitally. This method offers faster processing and immediate confirmation of receipt.

• Mail submission: Print completed Form 3949-A and mail to: Internal Revenue Service, Fresno, CA 93888

"Specificity is the most important factor in triggering a successful IRS investigation," advises Kindness. "Provide exact dollar figures, specific bank accounts, tax years involved, and potential locations of hidden assets. The more you can turn your tip into a roadmap for the IRS, the more highly they will prioritize it."

Anonymous Reporting and Confidentiality Protection

The IRS maintains strict confidentiality protocols to protect individuals reporting suspected tax fraud.

Anonymous Reporting Options

• Form 3949-A anonymous submission: You can submit Form 3949-A without providing any personal identifying information. However, anonymous reports may be less actionable if the IRS needs clarification or additional details.

• Confidential contact information: Providing contact information allows IRS investigators to follow up for clarification while keeping your identity confidential from the suspected violator.

IRS Confidentiality Protections

The IRS is legally required to protect informant identities under federal tax law. Your personal information will not be disclosed to the suspected violator or included in any public records related to the investigation.

Whistleblower Identity Protection: Even when filing Form 211 for potential rewards, the IRS Whistleblower Office maintains strict confidentiality throughout the investigation and award process.

What Happens After You Submit Your Report

Understanding the IRS process helps set realistic expectations about the timeline and communication after submitting your fraud report.

IRS Review and Investigation Process

Form 3949-A Processing

• Review as leads: IRS reviews submissions as investigative leads, not formal complaints requiring response.

• No communication: No confirmation, updates, or case status information provided to tipsters.

• Resource-based decisions: Investigation decisions based on available resources and case priority.

• Potential enforcement: May result in tax audits, criminal referrals, or civil enforcement actions.

Whistleblower Claim Processing

• Formal tracking: Form 211 submissions receive official case numbers and periodic updates.

• Extended timeline: The investigation timeline typically ranges from 2-7 years, depending on case complexity.

• Regular updates: Whistleblower Office provides status reports throughout the process.

• Award determination: Final award decisions are made after successful tax recovery.

No Guaranteed Investigation

The IRS evaluates fraud reports based on available resources, case priority, and likelihood of successful enforcement. Not all reports result in formal investigations, but credible information helps the IRS identify patterns and focus enforcement efforts.

The IRS doesn’t publicly disclose the exact percentage of Form 3949-A submissions that result in audits, actions, or successful recoveries. However, a 2019 TIGTA report found that the IRS used information from these referrals to assess over $1.8 billion in additional taxes over five years. 

At a payout rate of 15%-30%, that’s a potential $270-$540 million in payouts to whistleblowers over that time. The report also noted that the IRS examines the majority of referrals it receives, but resource constraints mean only the most promising leads with specific, credible information typically result in a full examination.

When to Contact TIGTA Instead

The Treasury Inspector General for Tax Administration (TIGTA) handles specific types of tax-related misconduct outside standard IRS fraud reporting.

TIGTA Reporting Situations

IRS Employee Misconduct

• Bribery and corruption: IRS staff demanding or accepting bribes or improper payments.

• Processing failures: IRS employees failing to process returns or payments properly.

• Audit misconduct: Inappropriate behavior by IRS personnel during audits or collection activities.

Tax Preparer Professional Violations

• Licensed preparer fraud: Licensed tax preparers engaging in fraudulent practices.

• Professional standard violations: Enrolled agents, CPAs, or attorneys violating professional standards.

• Software company facilitation: Tax preparation software companies enabling or facilitating fraud.

TIGTA Contact Information

• Phone reporting: Call 1-800-366-4484 for direct reporting.

• Online submission: Report online at treasury.gov/tigta.

• Anonymous options: Anonymous reporting available through multiple channels.

Important Do's and Don'ts When Reporting Tax Fraud

Following these guidelines helps ensure your fraud report provides maximum value to IRS investigators.

Do's for Effective Reporting

• Provide specific information: Include exact names, addresses, tax years, and dollar amounts.

• Use appropriate forms: Choose Form 3949-A or 211 based on your situation.

• Organize evidence: Compile documents chronologically with clear labeling.

• Maintain confidentiality: Keep your report confidential to protect the investigation’s integrity.

Don'ts That Undermine Reports

• Avoid illegal evidence gathering: Never break into offices, steal documents, or hack systems.

• Don't file false reports: Personal disputes don't constitute tax fraud.

• Avoid duplicate reporting: Don't submit multiple reports without new evidence.

"A common mistake is conflating personal disputes with tax fraud," warns Kindness. "Reporting a neighbor you dislike because they claimed a home office deduction will get your submission dismissed. Another critical error is gathering evidence illegally, which can get your report thrown out and expose you to legal liability. Stick to facts you've observed directly or have legitimate documentation for."

Frequently Asked Questions

Can I report tax fraud anonymously?

Yes, Form 3949-A allows a completely anonymous submission. You can report suspected tax fraud without providing any personal identifying information, though providing contact details helps if the IRS needs clarification.

Will I get a reward for reporting tax fraud?

Financial rewards are available only through the IRS Whistleblower Program using Form 211. Rewards range from 15-30% of recovered taxes and typically apply to cases involving substantial amounts ($2 million+ in tax, penalties, and interest).

How long does it take for the IRS to investigate tax fraud reports?

The IRS doesn't provide timeline guarantees for investigations. Form 3949-A submissions may never receive updates, while whistleblower cases typically take 2-7 years, depending on complexity and cooperation from the suspected violator.

When should I contact TIGTA instead of the IRS?

Contact TIGTA for fraud involving IRS employees, tax preparers violating professional standards, or misconduct in IRS operations. Use regular IRS reporting (Form 3949-A) for taxpayer fraud and evasion cases.

What happens if I provide false information in my report?

Deliberately providing false information to the IRS can result in penalties and criminal charges. Ensure your reports are based on credible observations and evidence rather than speculation or personal disputes.

Can the suspected violator find out who reported them?

The IRS maintains strict confidentiality protections for fraud reporters. Your identity will not be disclosed to suspected violators, though court proceedings in criminal cases might require testimony from key witnesses.

Conclusion: How to Report Tax Fraud to the IRS

Reporting tax fraud helps protect system integrity and ensures everyone pays their fair share. Whether you choose anonymous reporting through Form 3949-A or seek whistleblower rewards via Form 211, your information helps the IRS pursue violations that cost honest taxpayers billions annually.

"Take action on credible information, but manage your expectations," advises Kindness. "If you have specific, firsthand knowledge of fraud, reporting it is a civic duty. But the process is confidential and often slow-moving—you may not see results for years, if ever. File a legitimate report because it's the right thing to do, not because you expect immediate results."

Methodology

• Expert verification: All tax fraud reporting analysis and recommendations reviewed by David Kindness, CPA, and Founder of Your Creative CPA, for accuracy and practical applicability.

• Tax data sources: IRS reporting procedures, form requirements, and whistleblower program details sourced from current IRS guidelines, TIGTA reports, and official IRS publications.

• Industry statistics: Tax fraud recovery figures sourced from TIGTA annual reports and IRS Whistleblower Office data. Professional insights reflect expert practice experience with tax compliance issues.

• Verification process: All claims are cross-referenced with official IRS and TIGTA sources. Reporting procedures represent current standards as of the publication date.