In 2018, the IRS discontinued the Offshore Voluntary Disclosure Program (OVDP) which existed in various iterations since 2009. However, taxpayers with non-compliant offshore assets still have the opportunity to come forward and become compliant, provided that the IRS does not already have their information (e.g., from a foreign bank, treaty request, audit, etc.). For taxpayers whose facts may be considered by the IRS to be “willful” (e.g., intentional non-reporting, use of tax haven jurisdictions, use of anonymous foreign entities such as trusts or corporations), pre-emptive disclosure is still possible, with lower penalties than would apply if the IRS discovers the assets.
For taxpayers whose facts are non-willful or more benign, the IRS Streamlined Procedures continue to be available, with a limited look-back period and lower (or no) penalties. If there was no tax loss to the IRS from the foreign assets, then the Delinquent Informational Return Procedures may allow for zero penalties.
Our attorneys have many years of experience in advising clients with offshore assets on how to come into compliance, and representing such taxpayers before the IRS and state tax authorities. We can assess your facts, advise you on whether the IRS may deem you to be “willful”, advocate on your behalf and help bring you into compliance. Contact us to discuss your offshore situation.
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