IRS Offshore Voluntary Disclosure Program Reopens

On January 9, 2012, the Internal Revenue Service (the "IRS") reopened indefinitely its offshore voluntary disclosure program (the "2012 OVDP") to assist taxpayers in reporting undisclosed foreign accounts, assets, and income. The IRS press release (IR-2012-5) can be accessed here: http://www.irs.gov/newsroom/article/0,,id=252162,00.html?portlet=108.

This third offshore program is part of the IRS's continuing efforts to curb tax evasion through the use of offshore structures and financial accounts. The prior offshore programs were opened during the 2009 (OVDP) and 2011 (OVDI) calendar years.¹ These programs garnered significant revenues, and the IRS's hope for continued revenue along with offering an open door to increase compliance are the two main reasons for the revival of the disclosure program. Since the 2011 program closed this past September, taxpayers have continued to come forward to make voluntary disclosures. According to the press release, such taxpayers