is Voluntary Disclosure a Criminal Admission?

Voluntary Disclosure & Criminality

Is Voluntary Disclosure a Criminal Admission: No. When a Taxpayer submits to the voluntary disclosure program (VDP), they are not making a criminal admission. The Voluntary Disclosure Program is not a plea deal, and it is not an acknowledgment of guilt to the IRS. Rather, the purpose of VDP is to assist Taxpayers who are non-compliant with FBAR, FATCA and other international information reporting forms – but cannot certify under penalty of perjury that they are non-willful – but still want to bring themselves into offshore or domestic compliance. As of later 2018, VDP is used for both domestic or offshore submissions (OVDP was closed in September 2018).

Is Voluntary Disclosure a Criminal Admission to the IRS?

The purpose of Voluntary Disclosure is to assist Taxpayers who may be subject to possible criminal investigation or substantial civil penalties.

As provided by the IRS:

• • • The 2014 OVDP began as a modified version of the OVDP launched in 2012, which followed voluntary disclosure programs offered in 2011 and 2009.

    • These programs were designed for taxpayers with exposure to potential criminal liability or substantial civil penalties due to a willful failure to report foreign financial assets and pay all tax due in respect of those assets.

    • They provided taxpayers with such exposure potential protection from criminal liability and terms for resolving their civil tax and penalty obligations.

    • Taxpayers with unfiled returns or unreported income who had no exposure to criminal liability or substantial civil penalties due to willful noncompliance could come into compliance using the Streamlined Filing Compliance Procedures (SFCP), the delinquent FBAR submission procedures, or the delinquent international information return submission procedures.

    • Although they could be discontinued at any time, these other programs are still available.

Is Voluntary Disclosure Right For You?

If a person is willful, then the Voluntary Disclosure Program is the proper avenue to take in order to get into offshore tax compliance. But, Voluntary disclosure is only one of several international tax amnesty options available to taxpayers who are out of compliance for prior year non-filing or reporting. Each person should evaluate their own set of facts and circumstances to determine which program works best for them and their compliance goals.

We Specialize in Streamlined & Offshore Voluntary Disclosure

Our firm specializes exclusively in international tax, and specifically IRS offshore disclosure. 

Contact our firm for assistance.