On June 18, 2014, the IRS announced major changes to its 2012 Offshore Voluntary Disclosure Program (2012 OVDP). The 2012 OVDP was the third program that the IRS had created in order to assist taxpayers in reporting their unreported offshore financial assets/accounts and income. This program was similar to two prior IRS programs: (1) the 2009 Offshore Voluntary Disclosure Program (2009 OVDP); and (2) the 2011 Offshore Voluntary Disclosure Initiative (2011 OVDI), except for a few major distinctions, such as an increase in the highest penalty rate to 27.5% (up from 20% in the 2009 OVDP and 25% in the 2011 OVDI), and the lack of a set deadline for taxpayers to enter the program. Effective July 1, 2014, the changes made to the 2012 OVDP, now known as the 2014 Offshore Voluntary Disclosure Program (2014 OVDP), included, in part, increasing the penalty percentage from 27.5% to 50% in certain circumstances. The changes also included the following: (1) requiring additional information from taxpayers applying to the program; (2) eliminating the reduced penalty percentage for certain non-willful taxpayers in light of the new Streamlined Filing Compliance Procedures; and (3) requiring taxpayers to submit all account statements and pay the offshore penalty at the time of the OVDP application. The Law Office of Deborah J. Jacobs has been involved in Offshore Voluntary Disclosure since the advent of the 2009 OVDP, and has handled hundreds of cases, from beginning to end, including helping taxpayers struggling with the decision of whether to “opt out” of the program. If you have failed to disclose some of your offshore income or assets and/or failed to report your offshore accounts on Form TD F 90-22.1, commonly known as the FBAR (Report of Foreign Bank and Financial Accounts), and are considering entering the 2014 OVDP, we can help you make an informed decision about entering the program, and assist you every step of the way. We look forward to working with you to resolve your international tax matters. |