Closing the 2014 Offshore Voluntary Disclosure Program Frequently Asked Questions and Answers

Voluntary Disclosure Practice Updates

Visit the IRS Criminal Investigation Voluntary Disclosure Practice for the most current voluntary disclosure procedures.

Form 14457, Voluntary Disclosure Practice Preclearance Request and Application PDF, provides instructions detailing the current guidance regarding the voluntary disclosure practice and is to be used by taxpayers to apply for the IRS-CI Voluntary Disclosure Practice. The form is submitted by the taxpayer in two parts. Part I is a preclearance request. Once a taxpayer receives preclearance from IRS-CI, she will submit Part II, the voluntary disclosure application. Prior versions are out of date and were used by taxpayers to apply to the OVDP (closed on September 28, 2018). We welcome feedback to further improve this form and instructions. Please provide your feedback on the draft Form 14457 to: lbi.practice.unit.public.feedback@irs.gov

Closing the 2014 OVDP FAQs

(Last updated on 09-26-2018)

Is the 2014 OVDP closing?

Yes. The IRS will close the 2014 OVDP effective September 28, 2018. The FAQs for the 2014 OVDP provided that the program may close stating: "[T]he terms of this program could change at any time going forward. For example, the IRS may increase penalties or limit eligibility in the program for all or some taxpayers or defined classes of taxpayers – or decide to end the program entirely at any point."

Why is the IRS closing the 2014 OVDP?

While the program has been successful in the past, there has been a significant decline in the number of taxpayers participating as well as an increase in awareness of offshore tax and reporting obligations. The IRS has previously stated publicly that the 2014 OVDP would close at some time. Taxpayers have had the opportunity to participate in OVDP since 2009.

What is the deadline for making a submission to the 2014 OVDP?

Complete offshore voluntary disclosures conforming to the requirements of 2014 OVDP FAQ 24 must be received or postmarked by September 28, 2018 and may not be partial, incomplete, or placeholder submissions. Practitioners and taxpayers must ensure complete submissions by the deadline to request to participate in the 2014 OVDP.

Does the closing of the 2014 OVDP signal a change in IRS priorities towards offshore tax noncompliance?

No. Stopping offshore tax noncompliance and evasion remain top priorities of the IRS. The IRS enforces offshore compliance with tax and FBAR requirements using information received under the Foreign Account Tax Compliance Act (FATCA), the network of intergovernmental agreements between the U.S. and partner jurisdictions, automatic third-party account reporting, and other data-rich sources such as the Department of Justice's Swiss Bank Program and various John Doe Summonses. The IRS leverages information resources using enhanced data analytics to continue to make it more difficult to evade tax by hiding offshore.

How can taxpayers remedy significant offshore noncompliance after September 28, 2018?

Taxpayers will continue to have existing avenues to disclose offshore noncompliance after September 28, 2018. Additional information on how to make disclosures after September 28, 2018 will be posted on irs.gov.

Are there any changes to the Streamlined Filing Compliance Procedures with the closure of the 2014 OVDP?

No. The Streamlined Filing Compliance Procedures will remain available after the 2014 OVDP closes. The IRS encourages taxpayers who have offshore compliance issues and meet all of the qualifications of the Streamlined Filing Compliance Procedures to use these procedures while they are available. Only taxpayers that can certify under penalties of perjury that their conduct was non-willful may use the Streamlined Filing Compliance Procedures.

Can a taxpayer that uses the Streamlined Filing Compliance Procedures make a voluntary disclosure to Criminal Investigation after September 28, 2018?

No. Once a taxpayer makes a submission under the Streamlined Filing Compliance Procedures, the taxpayer may not make a voluntary disclosure to Criminal Investigation. Likewise, a taxpayer who makes a voluntary disclosure to Criminal Investigation is not eligible to use the Streamlined Filing Compliance Procedures.

For the rule concerning the differences between the Streamlined Filing Compliance Procedures and the 2014 OVDP, see the heading "Coordination between streamlined procedures and OVDP" on the main Streamlined Filing Compliance Procedures website.

What happens if a taxpayer simply files amended returns reporting income from previously undisclosed foreign financial assets without making a voluntary disclosure (commonly referred to as a "quiet disclosure")?

All quiet disclosures will be reviewed and will be subject to civil or criminal penalties as determined under existing law.

Will the delinquent FBAR submission procedures and the delinquent international information return submission procedures remain available after the 2014 OVDP closes?

Yes. The delinquent FBAR procedures and the delinquent international information return procedures will remain available for eligible taxpayers after September 28, 2018. Both procedures are for taxpayers that have information reporting failures but no tax noncompliance.

I have suggestions to provide the IRS on procedures relating to the IRS' voluntary disclosure practice after the 2014 OVDP closes. How can I provide my input to the IRS?

Tax practitioners and members of the public with feedback on the closure of the 2014 OVDP and suggestions on future voluntary disclosure practice procedures may provide written input to the IRS at the following email address: lbi.practice.unit.public.feedback@irs.gov

Please use the following in the subject line of any emails: "Suggestion for voluntary disclosure practice after OVDP closes."

The IRS will not send responses or acknowledgements. Do not send taxpayer identifying information (e.g., name, date of birth, taxpayer identification number, address, etc.) to this email address.

I recognize that preclearance from CI takes some time. With the IRS closing the 2014 OVDP on September 28, 2018, what's the last day I can ask for preclearance under 2014 OVDP FAQ 23?

Preclearance is not required to make a submission under the 2014 OVDP.

Because CI needs a minimum of 30 days to consider preclearance requests, all 2014 OVDP FAQ 23 preclearance requests must be submitted no later than August 24, 2018.

Complete offshore voluntary disclosures conforming to the requirements of 2014 OVDP FAQ 24 must be received or postmarked by September 28, 2018, and may not be incomplete or placeholder submissions.

I have concerns that I committed a tax or tax-related crime, and I want to remedy my significant noncompliance. What do I do after September 28, 2018?

The IRS is revising procedures for the voluntary disclosure practice. Until revised procedures are released, the procedures at I.R.M. 9.5.11.9 remain in effect.

Taxpayers and practitioners with questions for Criminal Investigation about the procedures at I.R.M. 9.5.11.9 may call CI at (267) 466-1607.