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IRS to End the Offshore Voluntary Disclosure Program

Posted on in Taxation Law

undisclosed foreign assets, offshore tax compliance, San Jose tax lawyer, offshore voluntary disclosure program, IRSRecently, we examined the options taxpayers have to achieve compliance when they have undisclosed foreign assets. One key method of compliance that the IRS has provided in recent years is the Offshore Voluntary Disclosure Program (OVDP). The program allows taxpayers to report their offshore assets and become compliant while minimizing their civil penalties and avoiding criminal prosecution. However, the IRS recently announced that it will be ending the OVDP on September 28, 2018.

Changing Options for Offshore Tax Compliance

The OVDP was launched in 2009, and the current version of the program has been in effect since 2014. The IRS has reported that since the OVDP was implemented, more than 56,000 taxpayers have used the program to achieve compliance—$11.1 billion in taxes, penalties, and interest have been paid. However, the number of people participating in the program has declined from a high of 18,000 people in 2011 to 600 in 2017.

Offshore tax compliance remains a primary concern of the IRS, and the end of this program does not in any way indicate that people with foreign assets will be subject to less scrutiny. In fact, the IRS has stated that it plans to use data analytics, whistleblower leads, and other resources to discover undisclosed offshore assets. Moreover, the IRS will continue to fight tax avoidance through education, civil examination (audits), and criminal prosecution.

Taxpayers with undisclosed offshore assets may want to consider using the OVDP before it ends in September 2018. Additionally, taxpayers may be eligible for other programs such as streamlined compliance. The streamline compliance program allows taxpayers who were not aware of their requirements for offshore disclosure to become compliant. The IRS has stated that this program may also be discontinued in the future; therefore, taxpayers who qualify may wish to take advantage of it while it remains in effect.

Contact a San Jose Offshore Tax Attorney

If you have any questions about disclosing offshore assets through the OVDP or other programs, or if you need help understanding your requirements for reporting foreign assets under the Foreign Account Tax Compliance Act (FATCA), John D. Teter Law Offices can provide you with the legal assistance and representation you need. We will work with you to determine your eligibility for foreign asset disclosure programs and help you minimize your civil or criminal penalties while ensuring that you meet your ongoing requirements for reporting your assets to the IRS. Schedule your consultation with a San Jose, CA tax lawyer today by calling 408-866-1810.

Sources:

https://www.irs.gov/newsroom/irs-to-end-offshore-voluntary-disclosure-program-taxpayers-with-undisclosed-foreign-assets-urged-to-come-forward-now

https://www.forbes.com/sites/kellyphillipserb/2018/03/13/irs-announces-end-to-offshore-voluntary-disclosure-program/#6e7c215b77b3

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