Tag Archive for Offshore Voluntary Disclosure Program

Show Me The Money! Is The Source of OVDP Revenue Coming From Taxes Or Excessive Offshore Penalties?

On June 18, 2014, IRS Commissioner John Koskinen disclosed that the 2009, 2011, and ongoing 2012 offshore voluntary disclosure programs have resulted in more than 45,000 disclosures and the collection of about $6.5 billion in taxes, interest, and penalties. On its face, the OVDIs appear to be bringing into the government’s coiffures an average of approximately 9,000 taxpayers a year with approximately $1.3 billion in revenue.

However, the last six months paint a very different picture. That period is marked by anemic growth. Indeed, there were only 2,000 additional disclosures and $500 million in additional revenue. That may lead one to speculate that the OVDI, at least for high net Read More

Written by | Posted in FBAR • IRS • OVDP

Should I Stay Or Should I Go? – Part 19

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (final post of questions and answers)

XXIII. Does my case remain within the Voluntary Disclosure Practice even after opting out?

Yes. Therefore, you must cooperate fully with the examiner by providing all requested information and records. In addition, you must pay, or make arrangements to pay, the tax, Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 18

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XXII. If I opt out, will my case be referred for audit?

Yes, your case will be referred to the field for a complete examination of all issues. In that examination, the normal statute of limitations rules apply. If no exception to the normal three-year statute applies, the IRS will only be able to assess tax, penalties, and interest Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 17

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XXI. What if, after making a voluntary disclosure, I disagree with the application of the offshore penalty? What can I do?

Remember that the penalty framework for offshore voluntary disclosure and the agreement to limit tax exposure to eight years are package terms. Mediation with Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go – Part 16

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XX. Does the examiner have any discretion to settle offshore voluntary disclosure cases for amounts less than the 27.5 percent offshore penalty?

No. Examiners nave no authority to negotiate a different offshore penalty. However, in limited situations, the offshore penalty can be reduced from 27.5 percent to 12.5 percent Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 15

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XIX. Must I complete and sign agreements to extend the period of time to assess tax – including tax penalties – and to assess FBAR penalties for any years that are set to expire while my application is being processed?

Yes. Agreements to extend the period of time to assess tax (including tax penalties) and Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 14

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XVIII. How can the IRS propose adjustments to tax for more than three years without either an agreement from the taxpayer or a statutory exception to the normal three-year statute of limitations for making those adjustments?

Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 13

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XVII. If I transferred funds from one unreported foreign account to another during the voluntary disclosure period, will I have to pay a 27.5 percent offshore penalty on both accounts?

No. If you can establish that funds were transferred from one account to another, you will Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 12

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XVI. If I enter OVDP, will my voluntary disclosure be subject to an examination?

Normally, no examination will be conducted once the taxpayer enters the offshore voluntary disclosure program. However, the IRS reserves the right to conduct an examination. The normal process is for the voluntary disclosure to be assigned to an examiner who will certify its’ accuracy and completeness. The certification process is less Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 11

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XIV. If the amount of income that I underreported from my foreign bank account was de minimis, do I really need to enter the program?

According to the IRS, no amount of unreported income is considered de minimis for purposes of determining whether there has been tax non-compliance with respect to an Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 10

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XIII. I have two offshore accounts. No FBARs were filed. I reported all income from one account, but not the other. How do I report this?

The issue can be framed as follows: Must you report both accounts as a voluntary Read More

Written by | Posted in FBAR • OVDP

Should I Stay or Should I Go? – Part 9

Answers to the Most Frequently Asked Questions Regarding OVDP

As a tax attorney specializing in the Offshore Voluntary Disclosure Program (OVDP), nary a day goes by that I don’t get a call from a person inquiring about the OVDP. The questions asked are relatively the same. After a while, I began to make a list of the most frequently asked questions. Below are my answers to them: (continued)

XII. I have properly reported all of my taxable offshore income. I only recently learned that I should have been filing FBARs in prior years to report my personal foreign bank account. Must I come forward to disclose this?

Read More

Written by | Posted in FBAR • OVDP
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