Internal Revenue Services Extends Deadline for the 2011 Offshore Voluntary Disclosure Initiative
The Internal Revenue Service has extended the deadline to enter the 2011 Offshore Voluntary Disclosure Initiative from August 31, 2011 to September 9, 2011.
The Offshore Voluntary Disclosure Initiative allows people to report previously undisclosed offshore bank accounts and other types of accounts. The program requires that amended tax returns for 2003 to 2010 be filed, and taxes paid on offshore income not previously reported. In addition, the program requires payment of a penalty for non-disclosure of offshore accounts equal to 25% of the highest balance of accounts during 2003 through 2010. While the payment of taxes, interest and penalties is significant, the benefits of entering and successfully completing the program are greater. The penalty on undisclosed offshore accounts is significantly reduced. Of even greater importance, a person can avoid criminal prosecution and potential incarceration by successfully completing the Offshore Voluntary Disclosure Initiative.
In order to take advantage of the Offshore Voluntary Disclosure Initiative, a letter must be sent to the Internal Revenue Service Criminal Investigation office which contains personal identification information. In addition, a request for a 90 day extension to complete the voluntary disclosure requirements should be submitted to the Internal Revenue Service in Austin, Texas by September 9, 2011.