• IRS Announces 2011 Offshore Voluntary Disclosure Initiative In the Form of 53 Frequently Asked Questions and Answers
  • February 24, 2011
  • Law Firm: Alston Bird LLP - Atlanta Office
  • On February 8, 2011, the Internal Revenue Service (the “IRS”) published guidance in the form of answers to 53 “frequently asked questions” in announcing its long-awaited follow-up to the Offshore Voluntary Disclosure Program that closed on October 15, 2009 (the “2009 OVDP”). The stated goal of both the 2009 OVDP and this new initiative, the 2011 Offshore Voluntary Disclosure Initiative (the “2011 OVDI”), is the same—to encourage U.S. taxpayers with previously undisclosed foreign assets and income to disclose their existence to the IRS and thereafter be in compliance with U.S. tax laws. As discussed below, taxpayers who successfully participate in the 2011 OVDI will have a significantly reduced risk of criminal prosecution with respect to their prior non-disclosure of offshore assets and income and can avoid substantial civil penalties that would likely exceed the amounts a taxpayer will be required to pay under the 2011 OVDI framework.