If a Taxpayer is concerned that his or her failure to report income, pay tax and submit required information returns was due to willful conduct and who wants more assurances that they will not be subject to criminal inability and/or substantial monetary penalties, that taxpayer should consider participating in the Offshore Voluntary Disclosure Program (OVDP) and should consult with their professional tax or legal advisers.
This Offshore Voluntary Compliance Program is a separate I.R.S. Program that waives certain serious penalties but asserts a much higher overall penalty than the Streamlined Procedure and it assures taxpayers that they will have a perfectly clean slate.
Coordination With Treatment Under OVDP
Once a taxpayer makes a submission under either the Streamlined Foreign Offshore Procedures of the Streamlined Domestic Offshore Procedures, the taxpayer may not participate in OVDP.
Similarly, a taxpayer who submits an OVDP voluntary disclosure letter on or after July 1, 2014, is not eligible to participate in the streamlined procedures.
A taxpayer eligible for treatment under the Streamlined Procedures who submits, or has submitted, a voluntary disclosure letter under the OVDP (or any predecessor offshore voluntary disclosure program) prior to July 1, 2014, but who does not yet have a fully executed OVDP voluntary disclosure letter on or after July 1, 2014, is eligible to participate in the streamlined procedures.
The Streamlined Procedures will apply to all United States taxpayers that are residing both within and without the United States. The rules are slightly different for U.S. taxpayers who reside without the United States.