The IRS has announced the Offshore Voluntary Disclosure Program (OVDP) will be closing on September 28, 2018.
OVDP – What is it and why is it ending?
The Offshore Voluntary Disclosure Program (OVDP) is for taxpayers who come forward voluntarily and report their previously undisclosed foreign accounts and assets. It provides taxpayers with a way to avoid criminal liability and resolve their tax and penalties.
The IRS launched the open-ended disclosure program after strong interest in previous OVDPs. Since 2009, there have been more than 56,000 disclosures and more than $11 billion collected in tax by the IRS using this program.
While use of the program peaked in 2011 with 18,000 taxpayers participating, in recent years, there has been a significant decline (600 disclosures in 2017). Read the full IRS guidance and FAQs on the closing of OVDP.
If you think this program might apply to your situation, there is still time to avail of the program, which closes on September 28, 2018.
If you have been unaware of your requirements to file U.S. tax returns and of your reporting obligations (i.e. reporting foreign bank and financial accounts using FBAR / Fincen Form 114), it is more likely the Streamlined Filing Compliance Procedures are more relevant to your situation.
The Streamlined Filing Compliance Procedures remain open
The Streamlined Filing Compliance Procedures will remain available after the OVDP closes. These procedures are aimed at individuals who may not have known about their tax obligations. To use this program, taxpayers must certify that conduct was not willful (i.e. that failing to report all income, pay all tax and submit all required information was due to a misunderstanding of the requirements).
The Streamlined Filing Compliance Procedures have been used by around 65,000 people to meet their tax and reporting obligations to become compliant.
If you would like additional information on the OVDP program, Anaford Tax & Accounting Services (“ATAS”) is in a unique position to assist you with both legal and tax advice. We work closely with our sister firm, Anaford Attorneys, to provide clients with a broad range of services. We strongly recommend you first consult with one of our attorneys for legal advice to ensure the confidentiality of your information under the attorney-client privilege, which does not apply to non-attorneys. We would then work closely with them in providing you with the tax services you require. To contact Anaford Attorneys, please visit www.anaford.com/contact-us.
Taxes are what we do. Our accountants know the ins and outs of taxes for U.S. taxpayers residing in and outside the United States. The ATAS team can assess your tax liabilities and help you choose the best options for you. For all of your tax-related services, you may contact ATAS directly at firstname.lastname@example.org or call us at any of our offices.