Whistleblower 769-16W v. Commissioner, 152 T.C. 172

Petitioner submitted an initial Form 211 (July 2010) naming three taxpayers and later filed supplemental Forms 211 expanding the list to seven taxpayers alleging a tax‑avoidance scheme.
The Whistleblower Office assigned three claim numbers, referred the matter to LB&I, and interviewed petitioner; LB&I concluded the IRS already knew of the scheme and the taxpayers were under examination.
Petitioner provided similar information to a congressional committee; the committee issued a report in 2014 and petitioner later forwarded that report to the Whistleblower Office along with additional names.
On December 9, 2015, the Whistleblower Office issued a final determination denying petitioner an award, finding the IRS had identified the issue before receiving petitioner’s information and that petitioner’s submissions did not contribute to IRS actions.
Petitioner timely petitioned the Tax Court; after litigation started, the Commissioner moved to remand to the Whistleblower Office because the administrative record was incomplete regarding whether the congressional committee report included petitioner’s information or whether the IRS used that report to commence or expand actions that produced collected proceeds.
The Tax Court granted the Commissioner’s motion to remand, holding that remand is appropriate where the administrative record does not permit meaningful review and remand would conserve resources without unduly prejudicing petitioner.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Tax Court may remand a §7623(b) whistleblower award case to the Whistleblower Office	Whistleblower argued IRS already had years to act and the Court should proceed to trial under Court supervision	Commissioner sought remand because the administrative record is incomplete and the Whistleblower Office should consider additional information (e.g., congressional report)	Court held it may remand in appropriate circumstances and granted remand here
Whether remand would unduly prejudice petitioner	Petitioner argued remand delays payment and harms him	Commissioner argued further administrative consideration is necessary and could conserve resources	Court found no undue prejudice because any award would not be paid immediately and remand may avoid wasted litigation
Whether the Court’s review is limited to the administrative record and the proper standard	Petitioner sought supplementation/discovery to establish facts outside the record	Commissioner relied on administrative record and need for agency reconsideration	Court reiterated review is record‑based and for abuse of discretion; remand proper if record is insufficient
Whether supplementation/discovery should proceed now instead of remand	Petitioner moved to compel documents now	Commissioner argued supplementation will occur on remand	Court held petitioner’s motion to compel in abeyance pending administrative supplementation on remand

Kasper v. Commissioner, 150 T.C. 8 (Tax Ct.) (scope of review of §7623(b) is record‑based and standard is abuse of discretion)
Florida Power & Light Co. v. Lorion, 470 U.S. 729 (U.S. 1985) (remand appropriate when agency failed to consider relevant factors)
SEC v. Chenery Corp., 332 U.S. 194 (U.S. 1947) (agency decisions judged on grounds actually relied upon)
Camp v. Pitts, 411 U.S. 138 (U.S. 1973) (focal point for review is administrative record)
Friday v. Commissioner, 124 T.C. 220 (Tax Ct.) (discusses limits on remand where statute reserves jurisdiction to court)
Util. Solid Waste Activities Grp. v. EPA, 901 F.3d 414 (D.C. Cir.) (courts generally grant agency remand when agency intends further action)
Ethyl Corp. v. Browner, 989 F.2d 522 (D.C. Cir.) (courts prefer agencies cure their own mistakes to conserve resources)