T.C. Mem o. 2 01 4- 15 7

UNITED STAT ES TAX COURT

W HISTLEBLOW ER 22 23 1- 12 W , Pet it io ne r v. COMM ISSI ONER OF INTERNAL REVENUE, Resp on de nt

Doc ke t No . 22 23 1- 12 W . Fi le d Au gu st4, 2 01 4.

Ro be rt F . Katzb erg , forpe ti ti on er. Ch arl es J. Bu tl er, fo r res po nd en t.

MEMORANDUM FINDINGS OF FACT AND OPINION LAUBER, Ju dg e: Thi s wh is tl eb lo wer awar d c as e is be fo re the Co urt o n a m ot io n b y

th e In te rn al Rev enue Serv ic e (IR S o r res po nd en t) t o d is m is s fo r la ckof juri sd ic ti on . Peti ti on er re cei ve d s ev eral em ai ls fro m th e IRS Whi st le bl owe r Offi ce (Offi ce) t ha t p et it io ne r as se rts co ns ti tu te a de te rm in at io n re gard in g o ne of h is- 2 -

[* 2] cl ai m s. The i ss ue we m us t d eci de is whethe r th e IRS m ad e a “ de te rm in at io n 1 reg ard in g a n a ward ” wit hi n the m ean in g o f se ct io n 7 62 3( b) (4 ) su ffi ci en t t o c on fer juri sd ic ti on on th is Co urt. 2 FINDINGS OF FACT The se fin di ng s o f fac t ar e b as edon th e p art ie s’ pl ead in gs , a st ip ul at io n o f fact s wi th acco m

pa nyin g e xh ib it s, an d a n e vi de nt iary he ari ng . At th e h eari ng th e Co urt re cei ve d t es ti m on y fro m Ste ph enWhi tl oc k, Di rect orof the Offic e. He tes tifi edab ou t the Offic e’s pr oc edur es forpro ces si ng cla im s g en eral ly andab ou t i ts ha nd li ng of the pa rti cu lar cl ai m at i ss ue he re. W e fo un d h is tes ti m on y in st ru ct iv e an d c red ib le inall res pe ct s. Pet it io ne r fi le d F orm

21 1, Ap pl ic at io n fo r Awardfor Orig in al Inf

orm at io n, with the Offic e in Nov em be r 20 10 . On th e ap pl ic at io n p et it io ne r as se rte d tha t h e was co op erat in g wi th th e Dep artm en t o f Ju st ic e an d the IRS Cr im in al Inv es ti ga The Co urt g ran te d p et it io ne r’s m ot io n t o p ro ceedan on ym ou sl y inth is cas e. 1 Inaneffo rt t o p res erv e p et it io ne r’s an on ymity , th e p art ie s i n the ir b rie fs an d o th er fil in gs refe r to th e U.S. tax pa y er wh o i s the subjec t o f th e rel ev an t wh is tl eb lo wer cl ai m as “ Tax pa y er 1 .” W e wil l em pl oy the same con ve nt io n i n thi s o pi ni on . Whe n re ferr in g t o Tax pay er 1 an d t o p et it io ne r, we wil l em pl oy the m as cu li ne pro no un an d p os se ss iv e ad

jecti ve witho utin te nd in g t o c reat e an y im pl ic at io n c on cern in g the ge nd er o f ei th er p ers on . All st atut ory

refe ren ces are t o the Int ern al Rev enue Co de ineffe ctat t he 2 rel ev an t t im es . All d ol lar am ou nt s ar e ro un de d t o the ne ares t d ol lar.- 3 -

[* 3] ti onDiv is io n i n c on ne ct io n wi th th e o ng oi ng in ve st ig at io n o f two Swis s ba nk ers . Peti ti on er al le ge d tha t h is co op erat io n wi th th os e ag en ci es ha d l edto , an d wo ul d l eadto m or e, in fo rm at io n abo utth es e b an ke rs ’ in vo lv em en t i n t ax ev as io n b y

U.S. per so ns ha vi ng un de cl aredoff sh or e fi na nc ia l ac co un ts . On Dec em

be r 1, 2 01 0, the Offic e n ot ifi edpe ti ti on er tha t i t h adrece iv edth e Fo rm 21 1 a ndass ig ne d u ni qu e cl ai m nu m be rs to hi s cl ai m s re ga rd in g the two Swis s b an ke rs . The Offi ce ad vi se d p et it io ne r th atif i t i ni ti at edanin ve st ig at io n a s 3
a res ul t o f th e in fo rm at io n, fi na l re so lu ti on of h is cla im s co ul d t ak e se ve ral y ears . No awa rdco ul d b e p ai d u nt il th e IRS ha d c ol le ct edan y tax es or o th er am ou nt s as se ss edby virtue of t he in fo rm at io n p et it io ne r ha d s up pl ie d. Subs eque ntco m

m un ic at io ns (le tt ers , em ai ls , andph on e cal ls ) en su edbe
twee n C in dy Stu art , th e Offi ce an al y stass ig ne d t o p et it io ne r’s cl ai m s, an d p et iti on er’s co un se l. Pet it io ne r’s co un se l trie d t o c on vi nc e Ms . Stu artan d the Offic e th atpe ti ti on er’s co op erat io n was th e li nc hp in inth e p ro se cuti on of t he two Swis s ba nk ers , whi chall eg ed ly ledto th e Gov ern m en t’s re cei vi ng in cri m in at in g i nf or m at io n abo utnu m ero us U.S. taxpa y ers .

The Offic e subs eque nt ly info rm edpe ti ti on er tha t “ th e cl ai m nu m be r 3 as si gn m en t i s s tri ct ly for co nt ro l p ur po se s * * * an d n o i nf

eren ce s ho ul d b e drawn of th e ap pl ic ab il ity

of a ny award p aym en t.”- 4 -

[* 4] On Au gu st23 , 20 11 , pet it io ne r fi le d wi th th e Offi ce a thi rdcla im foran award , whi chis th e subjec t o f th e p res en t co nt ro ve rs y . Peti ti on er fi le d thi s cl ai m aft er l earn in g tha t Tax pa y er 1 ha d a gr eedto pa y a subs tant ia l p en al ty in co nju nc ti onwith agu il ty ple a fo r fi li ng a fal se tax return. Taxpay er 1 admitte d tha t o ne of th e Swi ss ba nk ers ha d h el pe d h im op enSwis s b an k a cco un ts to co nc eal hi s i nco m e an d a ss et s fr om

U.S. aut ho rit ie s. By the gu il ty ple a, Tax pa y er 1 ag reedto pa y a m ul ti m il li on -d ol lar ci vi l p en al ty for fai li ng to fil e Fo rm TD F 90 -2 2.1 , Repo rt o f Fo rei gn Ban k a ndFin an ci al Acco un ts (FBAR) . See 3 1 U.S.C. s ec. 5 32 1( a) (2 00 6) . Taxp ay er 1 als o a gr eedto pa y th e IRS a rel at iv el y

sm al l am ou ntof res ti tu ti on , refl ect in g u np ai d F ed eral in co m e ta x due on in co m e earne d fr om th e Swis s b an k a cco un ts . Peti ti on er cl ai m eden ti tl em en t t o a n a wardba se d upo n the ag gr eg at e am ou ntpa idby T ax pa y er 1 , gi ve n p et it io ne r’s al le ge d i nv ol ve m en t i n th e Swi ss ba nk er’s arr es t, wh ic h l edto Taxp ay er 1 ’s arres t. OnJan ua ry 11 , 20 12 , th e Offi ce as si gn edth is cla im a un ique cla im

nu m be r en di ng in67 (Taxpa y er 1 cl ai m). On J anua ry

26 , 20 12 , pet it io ne r’s co un se l s en t M s. Stuart ade ta il edm em oran du m ou tl in in g p et it io ne r’s as se rte d c on ne ct io n wi th Taxp ay er 1 an d urg in g tha t anawardforth e Tax pay er 1 cla im be fin al iz edwitho utde lay . On Ja nu ary 31 Ms . Stua rt m ai le d p et it io ne r’s co un se l a l et te r co nf irming rece ip t o f th e Janu ary 26- 5 -

[* 5] let te r. She in fo rm edhi m th at“ [t]he cla im

forawardun de r Sec ti on 76 23 is st il l o pe n a ndun de r act iv e co ns id erat io n” an d tha t “ a num be r of act io ns * * * m

us t be co m pl et edbe fo re a d et erm in at io n i s m ad e.” Pet it io ne r’s co un se l s en t M s. Stua rt anu m be r of fol lo w-up l et te rs be twee n Feb ru ary an d J un e 2 01 2. Inhe r rep li es Ms . Stu artst at edth atth e Offi ce h adno t y etrece iv edth e in fo rm at io n n eces sa ry to m ak e a d et erm in at io n; th atth e Tax pa y er 1 c la im was n oty etready

forde ci si on ; an d tha t s ect io n 6 10 3 p rev en te d h er fro m di sc us si ng cert ai n m atte rs with p et it io ne r’s co un se l. Inanem ai l d at edAug us t 8 , 20 12 , Ms . Stu artclo se d h er m es sa ge by stat in g: “ As fo r y ou r in qu iry rega rd in g [th e Tax pa y er 1 ] cl ai m

* * * , I b el ie ve y ousp ok e to [anOffic e em pl oyee] ab ou t y ou r co nc ern s. I h av e in cl ud edth e Servi ce’s p os it io n o n thi s t op ic . If y oust il l ha ve co nc ern s you c anco nt actm e.” One co nc ernpe ti ti on er’s co un se l h adex pr es se d was whethe r FBAR p ay m en ts wou ldbe in cl ud ab le in“ co ll ect edpro ceed s (i nc lu di ng pe na lt ie s, i nt eres t, ad di ti on s t o t ax , andad di ti on al am ou nt s) ” th atform th e b as is foranawardun de r se ct io n 7 62 3( b) (1 ). Aware o f th is co nc ern , Ms . Stu artatt ach edto he r em ai l a m em or an du m

pre pa redforSte ph enWhi tl oc k b y MarkS. Kaiz en , Ass oc ia te Ch ie f Co un se l, IR S Gen eral Lega l Se rv ic es , dat edApri l 2 3, 2 01 2. Th is m em or an du m art ic ul at es th e le ga l fo un da ti on forth e Offi ce’s p os it io n tha t FB AR pa ym en ts ,- 6 -

[* 6] be cau se th ey

are m ad e p ur su an t t o t it le 31 rathe r th anti tl e 2 6 o f th e U.S. Co de , are n ot“ co ll ect edpro ceed s” withi n the m ean in g o f se ct io n 7 62 3( b) (1 ). The Offi ce re cei ve d thi s ad vi ce af te r itha d s ou gh t g ui da nc e o n the m at te r. Ms . Stu art at ta ch edth is do cum en t t o h er em ai l as a co urte sy to p et it io ne r. Pet it io ne r’s co un se l re sp on de d t o M s. Stua rt b y em ai l the ne xtda y

as f ol
lo ws: “ Pl eas e co nf

irm ou r rea di ng of your em ai l b el ow tha t b as edon th e Servi ce’s po si ti onex pr es se d i n the Apri l 2 3, 2 01 2 m em o youatt ach edy ou r Offi ce h as no w of fic ia ll y de ni ed[th e Tax pay er 1 ] Cl ai m .” At tha t t im e th e Offi ce h adno t de te rm in edwhet he r th e Tax pa y er 1 cla im m eri te d an a wardbe cau se itha d n oty et le arn edfro m

th e o pe rat in g s id e o f th e IRS whet he r orho w pet it io ne r’s in fo rm at io n was us ed , if atall , with re sp ectto Taxp ay er 1 . Ms. Stua rt a cco rd in gl y res po nd ed to pe ti ti on er’s co un se l b y em ai l the ne xtda y , Aug us t 1 0, 2 01 2, as fol lo ws: The [Tax pay er 1 ] cl ai m

* * * re m ai ns op en . Whe n the Whi st le bl owe r Offi ce h as m ad e a d et erm in at io n re la te d t o the cla im s fo r awardfil ed by [pet it io ne r] y ouwil l b e is su edoff ic ia l wri tt enco rres po nd en ce. At th is po in t we h av e n otm ad e a d et erm in at io n re ga rd in g * * * an y of th e rel at edcla im s. Th e Servi ce’s p os it io n e xp res se d i n the Apri l 2 3, 20 12 m em o tha t I p ro vi de d youwas s im pl y to lety oukn ow tha t atth e po in t a d et erm in at io n c anbe m ad e p ro ceed s co ll ect edun de r Tit le 18 an d/ or Tit le 31 wou ldno t b e co ns id eredas p artof t he cla im . Bec au se th e b ul k o f th e p ro ceed s co ll ect edfro m Taxp ay er 1 co ns is te d o f FBAR p aym en ts forvi ol at io n o f ti tl e 3 1, p et it io ne r de ci de d tha t the re was no th in g- 7 -

[* 7] m ean in gf

ul lef t fo r th e Offi ce t o i nv es ti ga te with re sp ectto th is cla im . Pet it io ne r th us vi ewedMs . Stu art ’s em ai ls as ade fact o d et erm in at io n tha t the Tax pay er 1 cla im

ha d b eende ni ed . On Se pt em

be r 6, 2 01 2, p et it io ne r fi le d ape ti ti on inth is Co urt t o c ha ll en ge th atsupp os edde te rm in at io n. OnDecem be r 21 , 20 12 , res po nd en t fi le d am ot io n t o di sm is s thi s ca se forlac k o f juri sd ic ti on . This m ot io n c on te nd s tha t the IRS h ad no t yet m ad e a d et erm in at io n re ga rd in g a n a wardsu ffi ci en t t o c on fer juris di ct io n on th is Co urt an d tha t, i n a ny even t, p et it io ne r’s cl ai m rel at es to ti tl e 3 1 a ndfal ls ou ts id e th e sc op e o f se ct io n 7 62 3. Dur in g J ul y

or Au gu st20 13 th e Offi ce re cei ve d i nf orm at io n fr om

th e IRS Cri m in al Inv es ti ga ti on Div is io n a ndth e IRS Larg e Bu si ne ss an d In te rn at io na l Div is io n tha t the Gov ern m en t h adno t u se d p et it io ne r’s in fo rm at io n a s a b as is for ta ki ng act io n a ga in stTaxp ay er 1 . The Offi ce the reaf te r is su edto pe ti ti on er, o n Sep te m be r 6, 2 01 3, a l et te r th atbo th pa rti es ag ree c on st itut es a “ de te rm in at io n” th atpe ti ti on er’s Tax pa y er 1 cla im ha s b eende ni ed . Peti ti on er fi le d ape ti ti on fro m th atde te rm in at io n, an d the m at te r is curren tl y pe nd in g b efo re the Co urt. See Whi st le bl owe r 22 71 6- 13 W v. Co m m is si on er, dkt . No. 2 27 16 -1 3W. Pet it io ne r ne ve rth el es s o pp os es res po nd en t’s m ot io n t o d is m is s the in st an t cas e fo r la ckof ju ris di ct io n. We agre e wit h the parti es th at , des pi te th e fi li ng of- 8 -

[* 8] th e se co ndpe ti ti on , th e in st an t ca se is no t m oo t b utco nt in ue s t o p res en t a jus ti ci ab le cas e o r co nt ro ve rs y . Thu s, we m ay de ci de whethe r to di sm is s the in st an t ca se forlac k o f juri sd ic ti on . OPINION Thi s C ou rt a lways ha s juris di ct io n t o d et erm in e whe th er i t h as juri sd ic ti on . Co op er v . Comm is si on er, 1 35 T.C. 70 , 73 (20 10 ). The Tax Co urt i s a c ou rt o f li mit edjuri sd ic ti on , andwe m us t as cert ai n wh ethe r th e cas e b efo re u s i s o ne th at Co ng res s h as au th or iz edus to co ns id er. See sec . 74 42 ; Es ta te of Yo un g v . Com
m is si on er, 8 1 T.C. 8 79 , 88 1 (1 98 3) . W e m ay no t en larg e upo n the st atut ory gra nt of ou r au th or ity . See Bre m anv. Co m m is si on er, 6 6 T.C. 6 1, 6 6 (1 97 6) . In thi s cas e, we m

us t d eci de whet he r co m

m un ic at io ns be twee n p et it io ne r’s co un se l an d Ms . Stu artest ab li shth atth e IRS ha d m ad e, as of Au gu st10 , 20 12 , a “ de te rm in ati onreg ard in g a n a ward ” withi n the m ean in g o f se ct io n 7 62 3( b) (4 ) su ffi ci en t t o co nf er jur is di ct io n o n thi s C ou rt. I. St atut ory

Fram ewo rk The IRS h as lo ng ha d aut ho rit y to pay award s t o p ers on s, n ow ca ll ed

“ whi st le bl owe rs ,” who pro vi de in fo rm at io n l ead in g t o the reco ve ry of u np ai d ta xe s. See sec . 76 23 (19 54 ). The p aym en t o f su chaward s was so le ly dis creti on ary fo r m an y

y ears . In re sp on se to co nc ern s ab ou t the m an ag em en t o f th e- 9 -

[* 9] di sc ret io na ry

awardreg im e, Co ng res s en act edleg is la ti on in20 06 to ad dr es s pe rcei ve d p ro bl em s wi th th e whi st le bl owe r pr og ram . Tax Re li ef an d Hea lth C are Act o f 20 06 , Pub . L. No. 10 9- 43 2, d iv . A, sec. 4 06 , 12 0 S tat. at29 58 (effe ct iv e Dec. 2 0, 2 00 6) . The 2 00 6 l eg is la ti on ad de d t o s ect io n 7 62 3 ane w subs ect io n (b ), whi chrequi res th e p aym en t o f no nd is cret io na ry whi st le bl owe r award s i n s pe ci fie d ci rcu m st an ces an d p ro vi de s thi s C ou rt ju ris di ct io n t o re vi ew IRS d et erm in at io ns reg ard in g s uc h a ward s. See Co op er, 1 35 T.C. at 7 3. A cl ai m an t wh o d oe s n ot m eetth e se ct io n 7 62 3( b) requi rem en ts for a no nd is cret io nary

awardrem ai ns eli
gi bl e fo r anawardat t he IRS’ di sc ret io n u nd er s ect io n 7 62 3( a). Sect io n 7 62 3( b) (1 ) requi res pa ym en t o f anawardif the IRS p ro ceed s wi th anadmin is tra ti ve or ju di ci al act io n t o c ol le cttax es “ba se d o n i nf orm at io n b ro ug ht to th e Sec ret ary’ s at te nt io n b y anin di vi du al .” The awardam ou ntm us t b e atlea st 15 % an d n otm or e th an30 % of “ th e co ll ect edpro ceed s (i nc lu di ng pe na lt ie s, i nt eres t, ad di ti on s t o t ax , andad di ti on al am ou nt s) res ul ti ng fro m th e act io n” or s et tl em en t the reo f. Ibi d. Th e d et erm in at io n o f th e am ou nt“ sh al l d ep en d upo n the ex te ntto whi chth e in di vi du al subs tant ia ll y co nt rib ut edto su chact io n.” Ibi d. 4 The IRS m ay

de te rm in e a l owe r pe rcen ta ge awardif the whi st le bl owe r 4 m ak es a le ss subs tant ia l co ntrib ut io n t o the reco ve ry or i f th e whi st le bl owe r pl an ne d a ndin it ia te d the act iv it ie s l ead in g t o the un de rp aym en t o f ta x. Se c. 76 23 (b )(2 ) an d (3 ). The IR S is di rect edto de ny an awar d a lt og ethe r if th e whi st le
- (co nt in ue d...)- 10 -

[* 10 ] Sect io n 7 62 3( b) (5 ) de fin es th e uni ve rs e o f cl ai m s tha t ar e subjec t t o the no nd is cret io na ry

awardpro gr am

est ab li sh edinsubs ect io n (b ). The IR S m us t p ay cl ai m s o n ano nd is cret io na ry ba si s o nl y

with re sp ectto act io ns ag ai ns t a t ax pa y er who se “ gr os s i nc om e ex ceed s $ 20 0,0 00 foran y tax ab le y ear s ub

ject t o s uc h act io n” an d o nl y

“ if t he tax , pen al ti es , in te res t, ad di ti on s t o t ax , andad di ti on al am ount s i n d is pu te ex ceed$2 ,00 0,0 00 .” Sec. 7 62 3( b) (5 )(A) an d (B ). Sect io n 7 62 3( b) (4 ), cap ti on ed“ App eal of Awar d Det erm in at io n,” go ve rn s ou r juri sd ic ti on ov er wh is tl eb lo wer cl ai m s. Itpro vi de s: “Any det erm in at io n re ga rd in g a n a wardun de r pa rag rap h (1 ), (2 ), or(3) m ay , withi n 3 0 d ay s o f su ch de te rm in at io n, b e ap pe al edto th e Tax Co urt (a ndth e Tax Co urt s ha ll have juri sdi ct io n wi th res pe ctto su chm at te r).” By referri ng to de te rm in at io ns “un de r pa ragr ap h (1 ), (2 ), or(3) ,” se ct io n 7 62 3( b) (4 ) m ak es cle ar tha t we h av e juri sd ic ti on to rev ie w on ly det erm in at io ns co nc ern in g n on di sc ret io na ry award s au th or iz edby subs ect io n (b ). II. Ana lysis As jur is di ct io na l p ro vi si on s g o, s ect io n 7 62 3( b) (4 ) is rathe r un us ua l. Un li ke m os t o th er s ect io ns of t he Int ern al Rev enue Co de th atco nf er jur is di ct io n o n thi s (...co nt inue d) 4 bl owe r is co nv ic te d c riminal ly for p lann in g andin it ia ti ng su chact iv it ie s. Sec . 76 23 (b )(3 ).- 11 -

[* 11 ] Co urt, s ect io n 7 62 3( b) (4 ) do es no t p res cri be any pa rti cu lar fo rm

of n ot ic e to th e wou ld -b e p et it io ne r. Ind eed , itdo es no t l it eral ly requ ire th atth e IRS pro vi de th atpe rs on with wri tt enno ti ce o f an y ki nd , bu t s im

pl y th atitm ak e a

“ de te rm in at io n.” The s ta tu te ’s fai lu re t o s pe ci fy anun am bi gu ou s “ ti ck etto th e Tax Co urt” ha s cr eat edser io us in te rp ret at iv e an d p ract ic al pro bl em s, b ot h fo r whi st le bl owe rs an d fo r th e Co urt. W e ad dr es se d c ert ai n o f th es e p ro bl em s i n C oo pe r v. C omm is si on er, 1 35 T.C. at 7 5. We th ere h el d tha t we h av e juri sd ic ti on to rev ie w no t o nl y anIRS de te rm in at io n c on cern in g the am ou ntof a n a wardbu t al so “ an y de te rm in at io n t o de ny an awar d.” In a sc ert ai ni ng whet he r th e IRS ha s m ad e a d et erm in at io n t o de ny an awar d, we h el d tha t “ th e labe li ng [of anIRS co m

m un ic at io n i s] no t di sp os it iv e” an d “ do es no t co nt ro l wh ethe r th e d oc um en t co ns ti tu te s a d et erm in at io n.” Ibi d. We fou ndth atth e le tt er i ss ue d i n C oo pe r, whi le no t l ab el eda de te rm in at io n, “ st at es res po nd en t’s fi na l co nc lu si on th atpe ti ti on er i s n oten ti tl ed to anawardan d p ro vi de s an ex pl an at io n fo r th is co nc lu si on .” Id . at 7 6. Be cau se th e le tt er co ns ti tu te d “ a fi na l ad m in is tra ti ve de ci si on reg ard in g p et it io ne r’s whi st le bl owe r cl ai m s i n a cco rd an ce wi th th e es tabl is he d p ro cedur es ,” we he ldth at itco ns ti tu te d a“ de te rm in at io n re ga rd in g a n a ward ” wit hi n the m ean in g o f se ct io n- 12 -

[* 12 ] 76 23 (b )(4 ) an d tha t we ac co rd in gl y ha d juris di ct io n t o re vi ew it . 13 5 T.C. at76 . 5 Und er the se st an da rd s, i t s eem s cl ear t ha t the em ai l ex ch an ge s b etweenMs . Stua rt a ndpe ti ti on er’s co un se l d o n otest ab li sh th atth e Offi ce h adm ad e, as of Aug us t 1 0, 2 01 2, a “ de te rm in at io n” to de ny the Taxp ay er 1 cla im . To th e co ntra ry , Ms . Stu art ’s em ai l o f th atda te st at edth atth e Tax pa y er 1 cla im “ rem ai ns op en ” an d tha t p et it io ne r wou ld“be is su edoff ic ia l wri tt enco rres po nd en ce” o nc e th e Offi ce d idm ak e a d et erm in at io n re ga rd in g thi s cl ai m . As of Aug us t 1 0, 2 01 2, th e Offi ce was st il l wai ti ng to he ar fro m th e rel ev an t IR S o pe rat in g d iv is io ns wheth er the in fo rm at io n p et it io ne r supp li edha d l edto th e act io n a ga in stTaxp ay er 1 . Thi s i s an ess en ti al ele m en t tha t m us t b e sa ti sf

ie d b efo re the IRS ca n m ak e a n on di sc ret io na ry

awardde te rm in at io n u nd er s ect io n 7 62 3( b) (1 ). Sin ce the Offic e was st il l i nv es ti ga ti ng th is is su e, itha d n oty etm ad e “ a fi na l admin is tra ti ve de ci si on

Co ns is te nt ly w ith o urOpi ni on inCo op er, 1 35 T.C. at 7 5, we h av e h el d tha t 5 th e labe li ng of a n IR S co m m un ic at io n i s n otdi sp os it iv e in asc ert ai ni ng whet he r it ha s m ad e a “ de te rm in at io n” su ffi ci en t t o a ffo rdus juri sd ic ti on un de r ot he r Co de pr ov is io ns . See, e.g ., SECC v . Comm is si on er, 1 42 T.C. __ , __(sl ip op . at 7 ) (Ap r. 3, 2 01 4) (IRS l ette r was a “ de te rm in at io n” co nc ern in g wo rk er cl as si fic at io n fo r pu rp os es of s ect io n 7 43 6( a)); Co rb al is v. Co m m is si on er, 1 42 T.C. __ , __(sl ip op . at 2 1- 22 ) (J an . 27 , 20 14 ) (IRS let te r was a “ de te rm in at io n” co nc ern in g i nt eres t ab at em en t fo r pu rp os es of s ect io n 6 40 4( h) ).- 13 -

[* 13 ] reg ard in g p et it io ne r’s whi st le bl owe r cl ai m [] in ac co rd an ce wi th th e es tabli sh edpro cedur es .” See C oo pe r, 13 5 T.C. at76 . Inurg in g aco nt rary con cl us io n, p et it io ne r rel ie s o n wh athe reg ard s as th e pl ai n m ean in g o f th e wor d “ an y .” See s ec. 7 62 3( b) (4 ). Acco rd in g t o p et it io ne r:

“ Co ng res s ch os e n otto li m itth is bro ad es t o f juri sd ic ti on al de le ga ti on s wi th m od ifie rs on th e wor d ‘an y ’ su chas ‘di sp os it iv e’ or ‘m at eri al .’ ” Pet it io ne r co nt en ds th atwe sh ou ldno t re adin to th e st atut e an y li m it in g l an gu ag e an d tha t “ ‘any de
te rm in at io n re ga rd in g a n award ’ m ean s ju stth at .” W e are no t p ers ua de d. Inhe r Aug us t 1 0, 2 01 2, em ai l, Ms . Stu artin fo rm ed pe ti ti on er’s co un se l tha t the Offic e h adrece iv edleg al advi ce tha t FB AR paym en ts can no t b e in cl ud edin“ co ll ect edpro ceed s” for pu rp os es of m ak in g a ward s u nd er se ct io n 7 62 3( b) . She acco rd in gl y advi se d h im

th at , “ atth e p oi nta de te rm in at io n canbe m ad e,” p ro ceed s co ll ect edun de r ti tl e 3 1 “ wou ldno t b e co ns id eredas p art of th e cl ai m .” As we h el d i n C oo pe r, 13 5 T.C. at75 , a “ de te rm in at io n re gard in g anaward ” m ean s a d et erm in at io n a s t o “ th e am ou ntof a n a ward ” o r a d et erm in ati on“ to de ny an awar d.” Con gr es s ca nn otpo ss ib ly hav e in te nd edth atth is ph ras e wou ldem br ace e ve ry

subs id iary

fin di ng of f

actor c on cl us io n o f la w th aten te rs in to th e Offi ce’s u lt im at e d eci si on as t o wh ethe r anawardis ap pr op ria te an d (i f so ) th e am ou ntth ereo f.- 14 -

[* 14 ] Even if the Offic e’s po li cy de ci si on co nc ern in g F BAR p aym en ts , con si deredinis ol at io n, d oe s n otco ns ti tu te a “ de te rm in at io n re ga rd in g a n a ward ,” pe ti
ti on er i ns is ts th atitco ns ti tu te s a d e fac to de te rm in at io n o n the pa rti cu lar fac ts of th is cas e. Thatis so , pet it io ne r co nt en ds , bec au se m or e th an99 % of t he ag gr eg at e reco ve ry fro m Taxp ay er 1 co ns is te d o f FBAR p aym en ts . Accor di ng to pe ti ti on er, th is de m on st rat es th atth e Offi ce h ad“ no th in g l eftto in ve st ig at e” re ga rd in g thi s cl ai m on ce i t co nc lu de d tha t the FBAR co m po ne ntco ul d n otqu al ify. Co nt rary to p et it io ne r’s as se rti on , th ere was so m ethi ng lef t fo r th e Offi ce t o in ve st ig at e--n am el y , whet he r th e act io n a ga in stTaxp ay er 1 was “ ba se d o n i nf orm at io n b ro ug htto th e Sec ret ary’ s at te nt io n b y [pe ti ti on er]” an d, i f so , whet he r th e in fo rm at io n p et it io ne r pr ov id edha d “ subs tant ia ll y co nt rib ut ed ” to th atreco ve ry . See s ec. 7 62 3( b) (1 ). Sect io n 7 62 3( b) (4 ) gi ve s u s juris di ct io n t o re vi ew “ an y de te rm in at io n re ga rd in g a n awardun de r pa rag rap h (1 ), (2 ), or(3) .” The IR S can no t m ak e a “ de te rm in at io n” un de r pa rag rap h (1 ) un ti l i t h as co m pl et edit s re vi ew of

all el em en ts sp eci fie d i n tha t p arag rap h. Th e Offi ce d idno t re cei ve fro m th e IRS op erat in g d iv is io ns , un ti l J ul y or Au gu st20 13 , th e in fo rm at io n n eces sa ry to asc erta in whet he r th e act io n a ga in stTaxp ay er 1 was “ ba se d o n i nf orm at io n b ro ug htto th e Sec ret ary’ s at te nt io n b y [pe ti ti on er]” or wh ethe r pe ti ti on er’s i nf orm at io n “ sub- 15 -

[* 15 ] st an ti al ly con tri bu te d” to th atreco ve ry . Only the n was th e Offi ce i n apo si
ti onto m ak e a co nc lu si ve “ de te rm in at io n” reg ard in g the Taxp ay er 1 cla im . Thi s h ol di ng is supp orte d n oton ly by th e st atut e’s la ng ua ge bu t al so by so un d p rin ci pl es of ju di ci al po li cy . It i s the po li cy of t hi s C ou rt “ to try all t he is su es rai se d i n acas e in on e p ro ceed in g t o a vo idpi ecemeal an d p ro tra ct edli ti ga ti on .” HaftTrus t v . Comm is si on er, 6 2 T.C. 1 45 , 14 7 (1 97 4) . The g oa l o f th is po li cy is to av oi d the in effi ci en cy an d dup li cat io n o f effo rt, wi th it s “ at te nd an t de lay an d was te of t im e,” tha t p ie cem eal li ti ga ti on in ev it ab ly ent ai ls . See Ko ve ns v. Co m m is si on er, 9 1 T.C. 7 4, 7 8 (1 98 8) . As th e fac ts of thi s ca se sh ow, o ur as su m pt io n o f juri sd ic ti on be fo re the Offic e h as co nc lu de d i ts en ti re i nv es ti ga ti on wou ldne ces saril y

lea d t o p ie cem eal li ti ga ti on . Whe n p et it io ne r fi le d h is pe ti ti on inou r Co urt, the Offic e h adno t yet as certa in edwhet he r hi s i nf

orm at io n h adledto act io n a ga in stTaxp ay er 1 . Sup po se th at we ha d t ak enjuri sd ic ti on of t hi s ca se an d d eci de d the qu es ti on pe ti ti on er p os es -- whe th er FB AR pa ym en ts co ns ti tu te “ ad di ti on al am ou nt s” withi n the m ean in g o f se ct io n 7 62 3( b) (1 ) an d (5 )(B) an d a re thu s p ro pe rly inc lu dabl e in th e b as is fora no nd is cret io na ry

award . W e n ow kno w th atth e Offi ce co nc lu de d, af te r pe ti ti on er fil edth e in st an t p et it io n, tha t h is in fo rm at io n d idno t l eadto th e rec ov ery fro m Tax pay er 1 , so th athe wou ldno t b e en ti tl edto anawardreg ard le ss of wh ethe r- 16 -

[* 16 ] FBAR p aym en ts co ns ti tu te “ ad di ti on al am ou nt s.” If th atco nc lu si on is co rrec t, the FBAR que st io n wo ul d the n b e m oo t, an d o urop in io n a dd res si ng th is is su e wou ldbe anadvi so ry op in io n. Th is de m on st rat es th e p ract ic al im po rta nc e o f al lo win g the Offic e to co nc lu de all asp ect s o f it s i nv es ti ga ti on an d re nd er “ a fi na l adm in is tra ti ve de ci si on* * * i n a cco rd an ce wi th th e es tabl is he d p ro cedur es ,” Co op er, 1 35 T.C. at 7 6, b efo re we u nd ert ak e rev ie w of an a wardde te rm in at io n. Accep ti ng pe ti ti on er’s i nt erp ret at io n o f se ct io n 7 62 3 wo ul d p ro du ce ab su rd orfut il e res ul ts , anda well -es tabl is he d ru le of s ta tu to ry co ns tru ct io n i s t o avo id su chou tc om es . See Co le st oc k v . Comm is si on er, 1 02 T.C. 38 0, 3 87 (19 94 ) (ci ti ng Uni te d S tate s v . Am . Truck in g As s’ns , 31 0 U.S. 5 34 , 54 3- 54 4 (1 94 0) . Und erta ki ng pre m atur e rev ie w of wh is tl eb lo wer cl ai m s wo ul d i ne vi tabl y lea d t o p ie cem eal li ti ga ti on an d p rev en t u s fr om trying all is su es inon e cas e. Bo th th e p la in lang ua ge of t he st atut e an d p rin ci pl es of ju di ci al po li cy th us supp ort the co nc lu
si onth atth e in st an t p et it io n i s p rem atur e an d tha t we l ackjuri sd ic ti on ov er i t. III. Fo rei gn Ban k Acc ou ntRep orti ng Inth e al te rn at iv e, res po nd en t co nt en ds th atth is Co urt l ack s juris di ct io n be cau se paym en ts un de r ti tl e 3 1 a re o ut si de th e sc op e o f se ct io n 7 62 3( b) (5 )(B) an d a re the refo re o ut si de th e sc op e o f ou r juri sd ic ti on un de r se ct io n 7 62 3( b) (4 ). Pet it io ne r ag rees th atth is is su e is juri sd ic ti on al an d u rg es th atth e Co urt re so lv e it .- 17 -

[* 17 ] Becaus e we h av e co nc lu de d tha t the Offic e d idno t m ak e a “ de te rm in at io n” withi n the m ean in g o f se ct io n 7 62 3( b) (4 ) su ffi ci en t t o c on fer juris di ct io n o n thi s Co urt, we n eedno t d eci de whet he r FBAR p aym en ts are “ ad di ti on al am ount s” for pu rp os es of a sc ert ai ni ng whet he r th e m on et ary th res ho ldinsec ti on 76 23 (b )(5 ) ha s be enm et , or wh ethe r th atqu es ti on is a juri sd ic ti on al on e. See Fr ie dl an d v . Com
m is si on er, T.C. Mem o. 2 01 1- 21 7, 1 02 T.C.M. (CCH) 2 47 , 24 9 (n otad dr es si ng th e m on et ary th res ho ldqu es ti on when gra nt in g re sp on de nt ’s m ot io n t o d is m is s fo r la ckof ju ris di ct io n) . To re fle ctth e fo reg oi ng , An o rd er o f di sm is sa l fo r la ckof juri sd ic ti on wil l b e en te red .