Legal Alert - IRS Announces Offshore Voluntary Disclosure Modifications and Revised Streamlined Procedures
by Carlene Y. Lowry, Mark A. Ziemba and William A. Kastin
On June 18, 2014, the IRS made significant changes to the procedures pursuant to which U.S. Persons can disclose any failure to timely file a Report of Foreign Bank and Financial Accounts (FBAR), and/or an international information return (e.g., Forms 3520, 3520-A, 5471, 5472, 8938, 926 and 8621). First, the IRS announced modifications to the 2012 Offshore Voluntary Disclosure Program (2012 OVDP), effective for new submissions made on or after July 1, 2014. The IRS refers to these modifications as the “2014 OVDP.” Second, the IRS significantly expanded the Streamlined Filing Compliance Procedures (Streamlined Procedures), by breaking the former procedure into two procedures depending upon whether the U.S. Person involved has been residing in the U.S. Finally, the IRS made slight revisions to its safe harbor procedures for those who have failed to file one or more of the above forms, but who have otherwise complied with applicable U.S. income tax laws.