FBAR and tax return non filers in the post IRS OVDI environment - What are the options now?
IRS Hot Topics
The IRS ended their 2011 Offshore Voluntary Disclosure Initiative (OVDI) for non filers of both U.S. tax returns and Foreign Bank Account Reports (FBARs) on December 9, 2011. After months of protests from U.S. individuals living abroad who either recently discovered they were dual citizens and/or thought they owed no U.S. tax because they had no U.S. filing obligations, the IRS issued an announcement on December 13, 2011 (Fact Sheet (FS) -2011-13) that summarizes the filing requirements and potential penalties for delinquent tax returns and FBARs. While this Fact Sheet was seen by many as a welcome return to "reasonableness," it left many procedural questions unanswered, particularly for those citizens who will owe U.S. taxes.