This case is before the Court on respondent's motion to dismiss for lack of jurisdiction. Petitioner commenced this whistleblower proceeding pursuant to section 7623(b)(4).
The following facts are drawn from the pleadings, the parties' motion papers, and the exhibits and declarations attached thereto. Petitioner resided in New York when the petition was filed.
On January 28, 2015, petitioner submitted 21 separate Forms 211, Application for Award for Original Information (whistleblower claims), to the Internal Revenue Service (IRS) Whistleblower Office (WBO). Petitioner alleged in these whistleblower claims that 21 individual taxpayers underreported their tax obligations with respect to litigation settlement awards they received. The information petitioner provided was based entirely on public records. These whistleblower claims are petitioner's ninth series of whistleblower claims submitted to the WBO.
The WBO notified petitioner that it had received the whistleblower claims and assigned her 21 separate claim numbers. The WBO informed petitioner that it would evaluate the information she provided to determine whether an investigation was warranted and an award was appropriate. Using petitioner's information, the IRS collected proceeds resulting from administrative actions against two of the taxpayers she had identified. After reviewing the administrative record, the tax analyst assigned to petitioner's whistleblower claims recommended an award to petitioner under section 7623(a).
Rather than choose one of those options, petitioner created a third box on the Response to Summary Report form, checked that third box, and stated: "I neither agree nor disagree with the preliminary award recommendation". On April 17, 2018, petitioner sent the Response to Summary Report form accompanied with a letter to the WBO. In the letter, petitioner stated that she would "need more facts to understand the handling of these 21 claims before * * * [she] could agree or disagree" with the award and inquired
On May 9, 2018, petitioner filed a petition with this Court requesting "disclosure of the information that would explain IRS decision-making" with respect to the preliminary award recommendation under section 7623(a). The WBO suspended further administrative consideration of petitioner's whistleblower claims when the claims became subject to the instant litigation. On June 20, 2018, respondent filed a motion to dismiss for lack of jurisdiction on the ground that no determination has been issued to petitioner with respect to her whistleblower claims that would confer jurisdiction on this Court. Petitioner objects to the granting of respondent's motion.
I. Tax Court Whistleblower Award Jurisdiction
The Tax Court is a court of limited jurisdiction and may exercise jurisdiction only to the extent authorized by Congress. Judge v. Commissioner, 88 T.C. 1175, 1180-1181 (1987); Naftel v. Commissioner, 85 T.C. 527, 529 (1985). We are without authority to enlarge upon that statutory grant. See Phillips Petroleum Co. & Affiliated Subs. v. Commissioner, 92 T.C. 885, 888 (1989). We nevertheless have jurisdiction to determine whether we have jurisdiction. Hambrick v. Commissioner, 118 T.C. 348, 350 (2002); Pyo v. Commissioner, 83 T.C. 626, 632 (1984); Kluger v. Commissioner, 83 T.C. 309, 314 (1984).
Section 7623(b)(4) provides that "[a]ny determination regarding an award under paragraph (1), (2), or (3) may, within 30 days of such determination, be appealed to the Tax Court (and the Tax Court shall have jurisdiction with respect to such matter)." See Whistleblower 14106-10W
II. "Determination" Within the Meaning of Section 7623(b)(4)
Section 7623 does not clearly define what constitutes a "determination" or require that the whistleblower be issued any particular form of notice. Kasper v. Commissioner, 137 T.C. at 41; see Whistleblower 22231-12W v. Commissioner, T.C. Memo. 2014-157, at *11. As a result, in prior cases "[w]e have held that the name or label of a document does not control whether the document constitutes a determination" and that "our jurisdiction is established when the Commissioner issues a written notice that embodies a determination." Cooper v. Commissioner, 135 T.C. 70, 75 (2010). The Court has not previously addressed whether a preliminary award recommendation under section 7623(a) constitutes a "determination" within the meaning of section 7623(b)(4). However, the Court has addressed whether any other form of written notice issued in a whistleblower case constitutes a "determination" that would confer jurisdiction upon this Court.
The Court held that a letter denying a whistleblower claim, although not labeled a determination, constituted a "determination" within the meaning of section 7623(b)(4) because it was "a final administrative decision regarding * * * [the] whistleblower claims in accordance with the established procedures." Cooper v. Commissioner, 135 T.C. at 76; see Kasper v. Commissioner, 137 T.C. at 41. Similarly, the Court held that a letter constituted a "determination" when it contained a statement on the merits of a whistleblower claim, referred for the first time in a letter to the whistleblowers to the fact that a determination had been made on their claim, and did not indicate that further administrative
The Court also addressed, in determining whether a petition was timely filed, when a "determination" occurs where the WBO has notified the whistleblower that an award will be forthcoming. The Court stated that, "[i]n the case of a favorable award decision, the * * * [WBO's] `determination' denotes a decision that the whistleblower will receive an award in a specific amount." Whistleblower 4496-15W v. Commissioner, 148 T.C. 425, 430 (2017). The Court found that neither the WBO's issuance of the preliminary award recommendation under section 7623(b) nor the whistleblower's acceptance of the award constituted a "determination" because the amount of the award remained "subject to conditions subsequent that could cause the award amount to be reduced." Id. Accordingly, the Court held that, absent an intervening final determination confirming the amount of the award, the WBO "issue[d] a written notice that embodie[d] * * * [its] determination" when it issued the award check and that this action notified the whistleblower of the "final administrative decision regarding * * * [his] * * * claims in accordance with the established procedures." Id. at 432 (citing Cooper v. Commissioner, 135 T.C. at 75-76).
III. Whether the Preliminary Award Recommendation Issued to Petitioner Constituted a "Determination"
In the motion to dismiss for lack of jurisdiction, respondent contends that the Court lacks jurisdiction because the preliminary award recommendation did not constitute a "determination" within the meaning of section 7623(b)(4). Petitioner contends the preliminary letter embodied a "determination" because the letter: (1) requested that she waive her appeal rights; (2) did not indicate that the preliminary award amount would change; and (3) did not indicate that a subsequent determination would be issued. The Court agrees with respondent.
The preliminary award recommendation stated that it commenced the whistleblower administrative proceeding and indicated that further administrative procedures were available to petitioner. See Comparini v. Commissioner, 143 T.C. at 279. The letter explained that petitioner could either agree and waive any judicial appeal rights or disagree and submit comments to the WBO within 30 days from the date of the letter. The WBO stated that it would "consider any comments received and send a Final Award Determination Letter." Other than requesting access to the administrative file, petitioner has not submitted any comments to the WBO in response to the letter, and respondent has not issued a final decision letter. Thus, this letter was not a final
Respondent issued the preliminary award determination in accordance with the framework set forth in the regulations for awards under section 7623(a).
We thus hold that the preliminary award recommendation respondent issued to petitioner did not constitute a "determination" within the meaning of section 7623(b)(4) because it was not a "final administrative decision regarding * * * [the] whistleblower claims in accordance with the established procedures." See Cooper v. Commissioner, 135 T.C. at 76.
In the event we agree with respondent, as we have, petitioner alternatively asks that the Court either order respondent to issue a final decision or consider the preliminary award recommendation a final decision in the interests of judicial economy. As previously stated, the Court may exercise jurisdiction only to the extent authorized by Congress and is without authority to enlarge upon that statutory grant. Judge v. Commissioner, 88 T.C. at 1180-1181; Naftel v. Commissioner, 85 T.C. at 529; see Phillips Petroleum Co.
We conclude that this Court lacks jurisdiction over this matter because no determination has been issued to petitioner that would confer jurisdiction on this Court. We have considered all the other arguments of the parties, and to the extent not discussed above, find those arguments to be irrelevant, moot, or without merit.
To reflect the foregoing,
An order and order of dismissal for lack of jurisdiction will be entered.