Tax Amnesty/Voluntary Disclosure Program (2019) – How to File
- 1 Tax Amnesty/Voluntary Disclosure Program
- 2 Tax Amnesty
- 3 Offshore vs. Foreign
- 4 Is there Still an IRS Voluntary Disclosure Program?
- 5 Willful or Reckless Disregard
- 6 Can I Go Streamlined?
- 7 Look What Happened to Manafort
- 8 Making an IRS Voluntary Disclosure – Use an Attorney
- 9 What Should You Do?
- 10 4 Types of IRS Voluntary Disclosure Programs
Tax Amnesty/Voluntary Disclosure Program: The IRS Provides various Voluntary Disclosure or “Tax Amnesty” programs Taxpayers can use to safely (and legally) get bring themselves into compliance.
Unfortunately, even though the Internal Revenue Service has ended the Offshore Voluntary Disclosure Program (OVDP),that does not mean that the IRS is limiting enforcement of offshore penalties.
When a person seeks to submit to IRS Tax Amnesty, they are moving forward with a Voluntary Disclosure of U.S. and/or Foreign Income Reporting.
Tax Amnesty/Voluntary Disclosure Program
The RS is still actively pursuing civil and even criminal prosecution.
Here are a list of recent Department of Justice indictments and convictions, Is that the U.S. government is actively enforcing offshore compliance.
Despite the IRS doing away with OVDP, there are still multiple tax amnesty programs you can use to avoid Tax Fraud, Tax Evasion & the IRS Special Agents. And, even if you were willful, there are options available to you outside of OVDP.
Offshore vs. Foreign
The IRS likes to use the term offshore when it refers to money outside of the United States. But, offshore is not limited to money sitting comfortably in the Bahamas, Caymans, or Malta – it means any money outside of United States.
Is there Still an IRS Voluntary Disclosure Program?
Yes, technically the traditional IRS (IRM) Voluntary Disclosure Program has been on the books for many years and is still active.
It Is part of the Internal Revenue Manual, but it is not the same as OVDP. The parameters for submitting under the IRS (IRM) Voluntary Disclosure Program are different than they are for OVDP.
Willful or Reckless Disregard
If you are willful, or acted with reckless disregard, then your best option and pretty much the only option is to submit using the IRS voluntary disclosure program (summarized below).
While the results are not guaranteed, it is still much better than being visited by the IRS Special Agents for a Criminal Investigation.
Can I Go Streamlined?
Not if you were willful. If you are fans of our blog, you will know that are very passionate about IRS Voluntary Disclosure.
We discuss this topic of going Streamlined when you were Willful or acted with Reckless Disregard often. That is because we have firsthand information of certain attorneys who behave unethically. They will literally take a potential client and tell them not to go OVDP or IRS Voluntary Disclosure – when the Attorney KNOWS the client is willful. They know the client cannot qualify for streamlined or reasonable cause. Still, these attorneys still refer the client to Streamlined or Reasonable Cause anyway, so they can make a quick buck at your expense.
Click Here to learn more about the dangers of going Streamlined when you were Willful.
These Attorneys are much less experienced (less than 15-20 years experience representing their own clients) and usually are not dually licensed EA and Attorney or CPA and Attorney). They also do not have a Master’s of Tax Law (LL.M.)
Look What Happened to Manafort
Especially after the Manafort conviction, our firm was inundated with calls from individuals identifying the same handful of law firms who gave them this horrible advice to begin with, which has now put these clients into a very serious potential situation involving both civil and criminal penalties – and possibly a criminal investigation.
Making an IRS Voluntary Disclosure – Use an Attorney
The voluntary disclosure material provided by the IRS indicates that the attorney should make the submission. There is no attorney-client privilege with a CPA, which means the information you discuss with your CPA may not be confidential or protected by privilege.
That also means the IRS maybe able to question a CPA about the contents of the submission. This is why you will not want to utilize a CPA to make this submission but rather an attorney to ensure you have the attorney-client privilege.
What Should You Do?
Everyone makes mistakes. If at some point that you should have been reporting your foreign income, accounts, assets or investments the prudent and least costly (but most effective) method for getting compliance is through one of the approved IRS offshore voluntary disclosure program.
4 Types of IRS Voluntary Disclosure Programs
There are typically four types of IRS Voluntary Disclosure programs, and they include:
- Traditional (IRM) IRS Voluntary Disclosure Program
- Streamlined Domestic Offshore Procedures (SDOP)
- Streamlined Foreign Offshore Procedures (SFOP)
- Reasonable Cause (RC)
Contact Us Today; Let us Help You.
Sean holds a Master's in Tax Law from one of the top Tax LL.M. programs in the country at the University of Denver, and has also earned the prestigious Enrolled Agent credential. Mr. Golding is also a Board Certified Tax Law Specialist Attorney (A designation earned by Less than 1% of Attorneys nationwide.)