March 21, 2018

IRS Announces End to OVDP; Taxpayers with Undisclosed Foreign Accounts and Assets Should Contact Their Tax Advisors Now

1 min

On March 13, 2018, the IRS announced that it will end the 2014 Offshore Voluntary Disclosure Program (OVDP) on September 28, 2018. The IRS is urging taxpayers with undisclosed foreign assets to come forward before the OVDP closes on September 28, noting that it will continue to use tools other than OVDP to pursue offshore tax avoidance. Curbing offshore tax avoidance and evasion continue to be top IRS priorities. The IRS will keep open other offshore tax compliance opportunities beyond September 28, including the Streamlined Filing Compliance Procedures, Delinquent FBAR Submission Procedures, and Delinquent International Information Return Procedures.

The current OVDP is a modification of prior offshore voluntary disclosure programs dating back to 2009. With each new version of OVDP, the IRS has imposed higher penalties on unreported and noncompliant foreign financial accounts and assets. If the IRS opens a new OVDP, it may be accompanied by increased penalties. Taxpayers currently holding unreported foreign accounts or assets should contact the International Tax Group at Venable LLP to assess whether the current OVDP is the best opportunity to come into compliance.