San Diego IRS OVDP Attorney
Why is the Offshore Voluntary Disclosure Program or OVDP the safest option for US taxpayers with unreported offshore accounts, assets and income? What impact does “willful versus non-willful” conduct have on the decision between the OVDP and the Streamlined domestic offshore procedures? What is an FBAR and why are you required to file it? All resident US taxpayers, including foreign nationals who reside in the US who have foreign bank accounts, investments, real property, foreign corporate interests or foreign trusts must disclose their income from these accounts to the Internal Revenue Service (IRS). If you are a U.S. citizen and don’t tell the IRS about foreign holdings, you can be charged with tax evasion. The IRS can leverage heavy civil and criminal penalties against individuals who do not disclose offshore accounts or who do not stay current with their tax returns. The OVDP is an IRS program that provides a process for US taxpayers to come into compliance with the IRS.
The IRS introduced its latest OVDP or Offshore Voluntary Disclosure Program in 2012. Recent legal actions by the U.S. Justice Department have provided the IRS with access to information about foreign bank and investment accounts, as well as offshore property. After July 1, 2014, the IRS will have access to a variety of sources and will gain even more cooperation from other nations and financial institutions as time goes forward. If the IRS has direct access to financial information, they don’t need to rely on taxpayers to provide it, and their incentive to continue the OVDP lessens dramatically. The IRS can close the program at any time, but for now, many people are racing to get in on the current voluntary disclosure initiative rather than have their information reported by the foreign banks.
US taxpayers must report all offshore bank accounts and foreign investments and assets to the IRS annually on the IRS FBAR. Coming into compliance with IRS FBAR reporting is an immediate and critical issue for US taxpayers with offshore interests. The failure to report and disclose offshore assets and income exposes the taxpayer to criminal tax evasion charges, as well as 50% to 100% penalties or $100,000 per incident, whichever is higher. The OVDP provides an opportunity to disclose these accounts and assets, correct previous FBAR filings and come into full compliance with IRS regulations. While the penalties may seem high, the cost for non-compliance is exponentially higher.
New and noteworthy: Read about the IRS’s streamlined domestic offshore procedures.
Come Into Compliance with IRS Offshore Reporting Requirements
The tax attorneys of Janathan L. Allen, APC provide valuable attorney-client protections that safeguard your information while they work to evaluate your unique financial circumstances and help to bring you into compliance. If you have issues with unreported or under-reported offshore assets, the time is now — right now — to avoid penalties by taking advantage of the OVDP, and we can do it more affordably than many law firms. We believe an ounce of prevention can be tremendously valuable.
The Foreign Account Tax Compliance Act (FATCA) is designed to increase compliance. It requires foreign banks to identify the accounts of people who may owe tax on the funds in the U.S. Generally, it is far better to voluntarily report required information about these accounts to the IRS than to have a foreign bank report your information to the IRS.
Contact an Experienced San Diego OVDP and FBAR Attorney
The IRS OVDP reduces risks, and provides a safe way through the offshore reporting controversies associated with FATCA and FBAR requirements. Contact Janathan L. Allen, APC for a free and substantive consultation with a knowledgeable international tax lawyer at 866-631-3470. The firm is based in San Diego, California, and we serve clients located in Europe, Asia and elsewhere. We offer the protections of the attorney-client privilege regarding the IRS voluntary disclosure initiative, FBAR and other important matters.