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Delinquent US Filer Disclosures.

Effective September 2018, the IRS will officially close the Offshore Voluntary Disclosure Program (OVDP).

The IRS are however, still committed to keeping the Streamlined Filing disclosure facility open for the time being. This allows US taxpayers to file the last three late US tax returns and last six late Foreign Bank Account Reports (FBARS) with reduced penalties assuming the non-filing can be shown to be non-wilful.

It is still common for us to be contacted by “accidental Americans” who were born in the US but have had no connection with the US since, and now find that they have had a US tax filing obligation for years. The Streamlined Filing disclosure facility is ideal for such individuals to get back into the system with minimal stress.

With the withdrawal of the OVDP, it is our view that the IRS may look to close down or amend the terms of the Streamlined Filing Program in the near future.  We therefore strongly advise you to contact us as soon as possible for advice on the IRS guidance on non-wilfulness.

For US taxpayers that have reported all their foreign income on their US returns but have not filed FBARS or information returns such as Forms 3520 (Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts) or 5471 (Information Return of U.S. Persons With Respect To Certain Foreign Corporations), alternative IRS procedures are available to get up to date in a penalty-free manner, subject to reasonable cause.

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