Is this the end of the OVDP for IRS FBAR disclosures regarding offshore bank accounts, investment accounts and assets? The IRS has in fact announced it will close the Offshore Voluntary Disclosure Program or OVDP on September 28, 2018. The IRS has strongly recommended that all US taxpayers, including resident aliens who live and/or work in the US, to come into compliance with US tax laws requiring disclosure of all foreign bank accounts, investment accounts and assets or face draconian penalties and the potential for criminal prosecution for tax evasion.
While there are still issues which surround willful versus non-willful conduct on the part of the taxpayer, the loss of the OVDP will be a substantial blow to the estimated tens of thousands of Californians who have yet to come into compliance with IRS FBAR reporting requirements. The IRS OVDP provides taxpayers with a way to create certainty regarding the closure of their financial exposure under FBAR compliance while eliminating the risk of criminal prosecution and the additional potential for a jail sentence and heavy fines.
Ignorance of the law is no excuse in the eyes of the IRS (as well as US tax law). Many have tried to claim they had no idea they were personally required to report offshore accounts or assets which they or their family had possessed for many years prior to entry to the United States. US tax laws specifically require US tax payers to disclose every offshore bank account, investment account, financial interest or asset if the accumulated balance of all of these accounts exceeds $10,000 at any point in the tax year, even if only for a day. This doesn’t mean the account has to be in your name. This applies to any taxpayer who had signatory authority, “other” authority or even a financial interest (purposefully vague providing the IRS room to audit and assess financial consequences) in the account(s).
The end of the OVDP for IRS FBAR disclosures means its absolutely time to come into compliance with the responsibility of all US taxpayers to fully disclose offshore banking, financial accounts and assets. We invite you to contact the experienced IRS FBAR and international tax attorneys at Allen Barron or call 866-631-3470 for a free consultation.