The IRS has developed the Offshore Voluntary Disclosure Program (OVDP) to allow taxpayers who have failed to disclose any offshore asset or financial account through mandatory FBARs to petition the IRS for relief from criminal consequences and propose tax settlements. Californians should be wary of this channel, as the OVDP comes with many hidden perils for those who are not experts in tax and accounting procedures and law. In essence, any change in your federal tax status will almost always translate to additional burden from the perspective of State taxes owed to California. This is one of the issues you should take into consideration as you approach the OVDP. As an attorney I can tell you that your greatest exposure relates to the criminal aspect of IRS tax consequences, as this can deprive you of your liberty and ability to spend time with loved ones and earn income.
If we set aside the criminal aspect of the OVDP, as a tax expert I can tell you that there are far too many nuances to the process from strictly a financial perspective to approach it on your own. You have options. Each option carries a financial cost, tax implications and potential criminal exposure. For some the OVDP might make sense. The IRS does not have to accept your OVDP application, and this development opens a whole new set of implications and consequences. You need expert tax and financial advice, as well as the protections afforded by the attorney-client privilege. I invite you to contact me at 866-641-3470 to schedule a consultation. You can discuss your unique financial circumstances with me under the protection of attorney-client privilege. I can then advise you as an attorney and tax expert in one step. This provides you with the most extensive protections available under the law, while helping you to fully understand your tax and financial options. We will put you in a position to make educated choices moving forward, in a much more efficient manner and lower cost than if you were forced to turn to separate financial, tax and legal advisors.
