U.S. taxpayers holding previously undisclosed offshore accounts have had to deal with a recent change in the tax laws. The Offshore Voluntary Disclosure Program (OVDP) used to be the IRS program allowing offshore account holders to report previously undisclosed accounts, while reducing tax penalties and avoiding criminal exposure. When the IRS ended OVDP in September 2018, the new voluntary disclosure program now applied to these same taxpayers holding offshore accounts.

For several years, Boston residents who failed to report their foreign financial assets to the Internal Revenue Service (IRS) were able to mitigate the consequences of their omission through the IRS’s Offshore Voluntary Disclosure Program (OVDP). However, the OVDP ended on September 28, 2018. While taxpayers still have options for voluntarily disclosing their offshore holdings, there are some important limitations. As a result, consulting one of the Boston IRS voluntary disclosure lawyers at Thorn Law Group is critical to avoiding substantial penalties.

In today’s global economy, it is common for U.S. citizens to work abroad. And if these non-residents want to maintain their American citizenship, they will need to deal with their U.S. tax liability. With the complexity of international tax law, workers abroad will need to understand their U.S. tax obligations and deal with any reporting requirements.

IRS REQUIREMENTS AND PENALTIES FOR DISCLOSING OFFSHORE BANK ACCOUNTS

What is an Offshore Account and How Do I Disclosure Mine?

Reporting an “offshore” bank account is imperative if a U.S. taxpayer has international assets.

In 2010, the Foreign Account Tax Compliance Act (FATCA) was passed by Congress and signed into law. The purpose of FATCA was to crack down on the use of offshore accounts to evade taxes. While FATCA has likely accomplished this goal, it has also made life much more difficult for American expatriates.