Foreign Account Amnesty & the IRS
Foreign Account Amnesty: When a person is out-of-compliance for unreported foreign accounts and assets, it can be unnerving feeling. The internet is littered with fear-mongering and scare mongering websites making you believe you are going to jail forever if you are out of compliance.
Some of the more common programs, include:
- Voluntary Disclosure Program (VDP or New OVDP)
- Streamlined Offshore Procedures
- Streamlined Domestic Program
- Streamlined Foreign Program
- Delinquent International Information Return Program
- Delinquent FBAR Program
Foreign Account Amnesty Programs
We will briefly summarize these FBAR Amnesty Programs, and provide you links to research more detailed information on our website.
Voluntary Disclosure Program (VDP or New OVDP)
The Voluntary Disclosure Program of the IRS, aka VDP or “New OVDP” (for offshore matters) is the traditional program that has been available to Taxpayers for many years. The program is generally used by Taxpayers who cannot certify under penalty of perjury that they are non-willful.
The program was recently updated.
Streamlined Offshore Procedure
In 2014, the IRS developed the stand-alone streamlined procedures. These procedures are used to assist Taxpayers residing in the U.S. or abroad, with offshore amnesty. The Streamlined procedures require Taxpayers to certify under penalty of perjury that they are non-willful.
In exchange, Taxpayers pay significantly less penalties – and may even qualify for a penalty waiver.
Streamlined Domestic Program (SDOP)
The Streamlined Domestic Program is reserved for non-willful U.S. residents who filed original tax returns timely. The program reduces the offshore penalties from upwards of 50% annually (to a 100% maximum) all the way down to 5%.
And, certain assets are excluded from the penalty computation, such as RRSP.
Streamlined Foreign Program (SFOP)
The Streamlined Foreign Program is reserved for non-willful foreign residents. Filers do NOT have to had filed timely original tax returns. Moreover, ALL tax and asset/account penalties are completely waived.
Delinquent International Information Return Program
The Delinquent International Information Return Program is an alternative to making Streamlined Disclosure. The process is less formalized (for better or for worse), and penalties are waived.
This procedure is primarily used by non-willful U.S residents who have no unreported income.
Delinquent FBAR Program
When the only issue involves the non-filing of the FBAR, the FBAR Delinquency Procedures may be available.
Like DIIRSP, these procedures are a less formalized alternative to the Streamlined Procedures.
This procedure is also used by non-willful U.S residents who have no unreported income, and penalties are waived.
Reasonable Cause is an alternative to Streamlined Procedures.
It is primarily used by U.S. residents (or foreign residents who do not qualify for Streamlined) who are seeking to avoid the SDOP 5% penalty – but do not squarely meet the requirements for Delinquency Procedures.
We Specialize in Streamlined & Offshore Voluntary Disclosure
Our firm specializes exclusively in international tax, and specifically IRS offshore disclosure and FBAR Amnesty Programs.
We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe. Our attorneys have worked with thousands of clients on offshore disclosure matters, including FATCA & FBAR.
Each case is led by a Board-Certified Tax Law Specialist with 20-years experience, and the entire matter (tax and legal) is handled by our team, in-house.
*Please beware of copycat tax and law firms misleading the public about their credentials and experience.
Less than 1% of Tax Attorneys Nationwide Are Certified Specialists
Our lead attorney is one of less than 350 Attorneys (out of more than 200,000 practicing California Attorneys) to earn the Certified Tax Law Specialist credential. The credential is awarded to less than 1% of Attorneys.
Recent Case Highlights
- We represented a client in an 8-figure disclosure that spanned 7 countries.
- We represented a high-net-worth client to facilitate a complex expatriation with offshore disclosure.
- We represented an overseas family with bringing multiple businesses & personal investments into U.S. tax and offshore compliance.
- We took over a case from a small firm that unsuccessfully submitted multiple clients to IRS Offshore Disclosure.
- We successfully completed several recent disclosures for clients with assets ranging from $50,000 – $7,000,000+.
How to Hire Experienced Offshore Counsel?
Generally, experienced attorneys in this field will have the following credentials/experience:
- 20-years experience as a practicing attorney
- Extensive litigation, high-stakes audit and trial experience
- Board Certified Tax Law Specialist credential
- Master’s of Tax Law (LL.M.)
- Dually Licensed as an EA (Enrolled Agent) or CPA
Interested in Learning More about our Firm?
No matter where in the world you reside, our international tax team can get you IRS offshore compliant.
We specialize in FBAR and FATCA. Contact our firm today for assistance with getting compliant.