IRS Will End Offshore Voluntary Disclosure Program in September

The Internal Revenue Service announced yesterday that it will end the Offshore Voluntary Disclosure Program (“OVDP”) on September 28, 2018 and wind it down over the coming months. IR-2018-52. The IRS established the OVDP voluntary compliance program in 2009, with its current incarnation set up in 2014, to allow taxpayers who willfully failed to report foreign bank accounts/assets to come forward voluntarily without fear of criminal liability, and to limit their civil penalties on specified terms. In making the announcement regarding the termination of the program, the IRS indicated that there has been a significant decline in participation coupled with an increased awareness of offshore tax and reporting obligations, making the program less necessary at present. For instance, in 2017, there were just 600 OVDP disclosures, whereas in 2011, at the peak, there were 18,000. The program did serve its purpose, however, as the IRS notes that taxpayers paid a total of…

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