Has the IRS decided to shut down the application process for the Streamlined Domestic Offshore Procedures under FBAR? Streamlined applications for FBAR compliance used to be submitted to the IRS via facsimile. The IRS has recently stopped access to fax submission of streamlined applications, and this may be a sign that the IRS intends to bring the OVDP or Offshore Voluntary Disclosure Procedures and the Streamlined Domestic (Foreign) Offshore Procedures. Several weeks ago, a high-ranking IRS official commented that the programs were never meant “to exist in perpetuity.”
What happens when the programs are closed? If you have offshore bank accounts, investments, assets, or income you must come into full compliance with FBAR and other IRS reports and make a “thorough, transparent, complete and accurate” disclosure or face draconian penalties of a 50% penalty for each year, or $100,000 per incident, whichever is higher. The IRS is receiving information directly from tens of thousands of financial institutions and banks worldwide. Over 100,000 additional institutions are providing this data through their sovereign tax authorities to the IRS.
The information disclosed includes the taxpayer’s identification including passport data, tax identification number or social security number, as well as detailed information about all accounts, balances, transactions and associated income. The failure to disclose your offshore assets exposes US taxpayers to penalties of 50% of the highest accumulated amount of all accounts at any point in the year, for each of the past six to eight years, or $100,000 per disclosure failure, whichever is higher.
Allen Barron is uniquely positioned to help US taxpayers to take immediate action to come into compliance with FBAR and offshore reporting requirements. While we cannot submit fax streamlined applications for FBAR compliance we have other channels to file applications for our clients. Our unique combination of legal, tax and international business expertise allows us to provide a single-source partner for US taxpayers attempting to come into FBAR compliance. We invite you to contact us or call 866-631-3470 for a free consultation. Ask about the protections of the attorney-client privilege.