IRS’s Reopened Offshore Voluntary Disclosure Program Provides Opportunity for Reduced Penalties

On January 9, 2012, the IRS announced the reopening of the Offshore Voluntary Disclosure program (the “OVDI”).  The voluntary disclosure process has provided people hiding offshore accounts a higher likelihood criminal amnesty, reduction of civil penalties, and peace of mind in exchange for becoming compliant with tax law.  The IRS says that the OVDI will be open for an indefinite period until otherwise announced.

For several years, the IRS has invested significant resources in eliminating tax evasion.  IRS Commissioner Dough Shulman noted that taxpayers “need to come in and get right with us [the IRS] before we [the IRS] find you.”  He further asserted that the IRS is “following more leads and the risk for people who do not come in continues to increase.”

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