SEE ALL TODAY'S STORIES »

IRS to end offshore voluntary disclosure programme for US citizens

15/03/2018 News Team

The US tax authority - the Internal Revenue Service (IRS) - will begin to ramp down the 2014 Offshore Voluntary Disclosure Programme (OVDP) before closing it on 28 September 2018. 

The IRS said that by alerting taxpayers now, it intends that any US taxpayers with undisclosed foreign financial assets have time to use the OVDP before the programme closes. 

“Taxpayers have had several years to come into compliance with US tax laws under this program,” said acting IRS commissioner, David Kautter. “

All along, we have been clear that we would close the programme at the appropriate time, and we have reached that point. Those who still wish to come forward have time to do so.”

Since the OVDP’s initial launch in 2009, more than 56,000 taxpayers have used one of the programmes to comply voluntarily. All told, those taxpayers paid a total of $11.1 billion in back taxes, interest and penalties. 

The planned end of the current OVDP also reflects advances in third-party reporting and increased awareness of US taxpayers of their offshore tax and reporting obligations.

The number of taxpayer disclosures under the OVDP peaked in 2011, when about 18,000 people came forward. The number steadily declined through the years, falling to only 600 disclosures in 2017.

The current OVDP began in 2014 and is a modified version of the OVDP launched in 2012, which followed voluntary programmes offered in 2011 and 2009.

The IRS notes that it will continue to use tools besides voluntary disclosure to combat offshore tax avoidance, including taxpayer education, whistle-blower leads, civil examination and criminal prosecution. Since 2009, IRS Criminal Investigation has indicted 1,545 taxpayers on criminal violations related to international activities, of which 671 taxpayers were indicted on international criminal tax violations.

“The IRS remains actively engaged in ferreting out the identities of those with undisclosed foreign accounts with the use of information resources and increased data analytics,” said Don Fort, chief, IRS criminal investigation. “Stopping offshore tax noncompliance remains a top priority of the IRS.”

Share with Linkedin Share with Twitter
SEE ALL TODAY'S STORIES »

 RATE THIS ARTICLE
Poor   Average   Good   Excellent