Termination of the Voluntary Foreign Disclosure Program
The Internal Revenue Service ("IRS") announced the termination of the Voluntary Foreign Disclosure Program ("OVDP") effective September 28, 2018.
The OVDP is a program designed specifically for taxpayers exposed to civil or criminal penalties for non-compliance with the responsibility of reporting foreign financial assets and with the payment of contributions attributable to them. Under this program, these taxpayers are provided with a vehicle to clarify their tax obligations with respect to these assets and protection of applicable criminal prosecution.
According to the Foreign Account Tax Compliance Act of 2010 ("FATCA"), certain U.S. citizens who possess certain specific foreign financial assets must report those assets to the federal government if they exceed certain established limits. Foreign financial assets that must be reported include:
Any financial account in any foreign financial entity, subject to certain limits.
Assets held as an investment that were not held in a financial institution, such as: shares or securities issued by foreign entities, any interest in foreign entities, any financial instrument or contract where the issuing entity or its counterparty is foreign.
Notes, bonds, obligations or any other type of debt issued by a foreign entity, interest in trusts or foreign successions and options, among others.
We encourage you to review your current situation and determine if you have foreign financial assets that require reporting. At Carbonell & Co., LLP we are prepared to assist our clients with these new requirements. If you have any questions or need assistance to determine if these provisions apply to you, please do not hesitate to contact us.
For additional information about the OVDP, please refer to our publication of July 1, 2014 by accessing the following link: