Bucci Law Offices
We provide tax representation for clients worldwide
MIAMI BEACH 305-340-2275
FORT LAUDERDALE 954-900-9107
TOLL FREE 800-743-4263

Hurricane Causes the IRS to Extend the 2011 OVDI Filing Deadline

Due to the destruction Hurricane Irene left in her path, the IRS recently announced that it has postponed the deadline for its 2011 Offshore Voluntary Disclosure Initiative (OVDI) to September 9, 2011. Before the extension, taxpayers had been required to complete all requirements for the program, or make a good-faith effort to comply and request a 90-day extension, by August 31, 2011.

Taxpayers who have not yet submitted requests and documents under the program must do so by the new deadline by submitting identifying information to the IRS' Criminal Investigation office and sending a request for a 90-day extension for submitting a complete voluntary disclosure information package to the IRS.

About OVDI

The IRS announced the 2011 OVDI in February. The program is designed to bring money held in foreign accounts back into the U.S. tax system and to help taxpayers with income from offshore accounts to comply with federal tax law. While there are legitimate business reasons for keeping an account outside of the United States, there are no legal reasons not to report those accounts and pay taxes on the money they earn.

Under the initiative, taxpayers who disclose previously undisclosed foreign accounts and comply with the terms of the program can avoid civil penalties and criminal prosecution. There was a similar program in 2009 that resulted in nearly 15,000 formerly undeclared accounts. After the 2009 program ended, thousands of more taxpayers came forward. In response to this demand, the IRS initiated the 2011 OVDI, which began in February and ends now on September 9th.

The largest difference between the 2009 program and the 2011 program is that while the 2009 program levied penalties only on financial assets, the 2011 program levies penalties on all assets kept abroad. The penalties are steep under the OVDI -- up to 25 percent of the value of the assets, assessed on the highest value of those assets over the last eight years. However, taxpayers can avoid even steeper penalties, as well as criminal prosecution if they opt out and are caught later.

No Comments

Leave a comment
Comment Information
Bucci Law Offices

Fort Lauderdale Office
2600 North Andrews Avenue
Fort Lauderdale, FL 33311

Toll Free: 800-743-4263
Phone: 954-900-9107
Fax: 954-764-4401
Map & Directions

Miami Beach Office
1130 Washington Avenue, 3rd Floor, Suite B
Miami Beach, FL 33139

Toll Free: 800-743-4263
Phone: 305-340-2275
Map & Directions

Email Us For A Response

Get Help With Your Tax Matter

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy