The IRS issued a reminder on Tuesday, September 4, 2018, that its Offshore Voluntary Disclosure Program (“OVDP”) will end on September 28, 2018. The IRS had previously announced the wind down of the program earlier this year.
The OVDP is a voluntary disclosure program specifically designed for taxpayers with exposure to potential criminal liability and/or substantial civil penalties due to a willful failure to report foreign financial assets and pay all tax due in respect of those assets. OVDP is designed to provide to taxpayers with such exposure (1) protection from criminal liability and (2) terms for resolving their civil tax and penalty obligations.
Please note that all submissions to the OVDP must be substantially completed by the September 28, 2018 deadline, and that partial or “placeholder” submissions will not qualify. Practitioners and taxpayers must ensure complete submissions by the deadline to request to participate in the OVDP.
Despite the wind down of the OVDP, the IRS has stated taxpayers will continue to have existing avenues to disclose offshore noncompliance after September 28, 2018, and that additional information on how to make disclosures after September 28, 2018 will be posted on the IRS website.
Notably, the IRS Streamlined Filing Compliance Procedures will remain available after the OVDP closes. Note, however, that only taxpayers that can certify under penalties of perjury that their conduct was non-willful may use the Streamlined Filing Compliance Procedures.
In addition, the delinquent FBAR procedures and the delinquent international information return procedures will remain available for eligible taxpayers after September 28, 2018. Both of these procedures are for taxpayers that have information reporting failures but no tax noncompliance.
For more information about your options to declare foreign financial assets or your options to pay potential taxes with respect to those foreign assets, please contact Mario Franke in the Firm’s El Paso office at 915-541-9334; David Jojola in the Firm’s Phoenix office at 602-285-5031; or Derek Kaczmarek at the Firm’s Phoenix office at 602-285-5044.