Offshore Voluntary Disclosure Requirements

Offshore Voluntary Disclosure Program Submission Requirements

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Offshore Voluntary Disclosure Program
Submission Requirements
As a condition to being accepted into the Offshore Voluntary Disclosure Program (OVDP),
applicants must provide the IRS the following for the eight year voluntary disclosure period.

1.

All applicants: Copies of previously filed original (and, if applicable, previously filed
amended) federal income tax returns for tax years covered by the voluntary disclosure.

2.

All applicants: Complete and accurate amended federal income tax returns (for
individuals, Form 1040X, or original Form 1040 if delinquent) for all tax years covered by
the voluntary disclosure, with applicable schedules detailing the amount and type of
previously unreported income from the account or entity (e.g., Schedule B for interest
and dividends, Schedule D for capital gains and losses, Schedule E for income from
partnerships, S corporations, estates or trusts, and, for years after 2010, Form 8938,
Statement of Specified Foreign Financial Assets). For taxpayers who began filing timely,
original, compliant returns that fully reported previously undisclosed offshore accounts or
assets before making the voluntary disclosure for certain years of the offshore disclosure
period, copies of the previously filed returns for the corresponding years.

3.

All applicants: Copy of your completed and signed Offshore Voluntary Disclosures
letter and attachment.

4.

All applicants: A check made out to the U.S. Treasury. The check must include the
amount of tax, interest, and accuracy-related penalty under IRC § 6662(a), and, if
applicable, the failure to file and failure to pay penalties under IRC § 6651(a) (the
suspension of interest provisions of IRC § 6404(g) do not apply to interest due in this
initiative). If you cannot pay the total amount of tax, interest, and penalties as described
above, submit your proposed payment arrangement and a completed Collection
Information Statement ( Form 433-A, Collection Information Statement for Wage Earners
and Self-employed Individuals, or Form 433-B, Collection Information Statement for
Businesses, as appropriate).

5.

All applicants: Completed Foreign Account or Asset Statement for each previously
undisclosed foreign account or asset during the voluntary disclosure period if the
information requested in that statement was not already provided in your initial Offshore
Voluntary Disclosures Letter.

6.

All applicants: Completed penalty computation worksheet showing the applicant’s
determination of the aggregate highest account balance of his/her undisclosed offshore
accounts, fair market value of foreign assets, and penalty computation signed by the
applicant and the applicant’s representative if the applicant is represented.

7.

All applicants: Properly completed and signed agreements to extend the period of time
to assess tax (including tax penalties) and to assess FBAR penalties.

8.

All applicants disclosing offshore financial accounts: Complete and accurate Form
TD F 90.22-1, Report of Foreign Bank and Financial Accounts, for foreign accounts
maintained during calendar years covered by the voluntary disclosure and/or copies of
previously filed FBARs.

9.

All applicants disclosing offshore financial accounts: For those applicants
disclosing offshore financial accounts with an aggregate highest account balance in any
year of $500,000 or more, copies of offshore financial account statements reflecting all
account activity for each of the tax years covered by your voluntary disclosure. Explain
any differences between the amounts reported on the account statements and the tax
returns. For those applicants disclosing offshore financial accounts with an aggregate
highest account balance of less than $500,000, copies of offshore financial account
statements reflecting all account activity for each of the tax years covered by your
voluntary disclosure must be available upon request.

10.

All applicants disclosing offshore entities: A statement identifying all offshore
entities for the tax years covered by the voluntary disclosure, whether held directly or
indirectly, and your ownership or control share of such entities.

11.

All applicants disclosing offshore entities: When accounts or assets were held in the
name of a foreign entity, complete and accurate amended (or original, if delinquent)
information returns required to be filed, including, but not limited to, Forms 3520, 3520-A,
5471, 5472, 926 and 8865 for all tax years covered by the voluntary disclosure. If the
applicant is requesting that the Service waive the information reporting requirement, the
applicant should submit a completed and signed Statement on Dissolved Entities. (See
FAQ 29.)

12.

Estates and certain executors or advisors. If the applicant is a decedent’s estate, or
is an individual who participated in the failure to report the foreign account, foreign asset,
or foreign entity in a required gift or estate tax return, either as executor or advisor,
provide complete and accurate amended estate or gift tax returns (original estate or gift
tax returns, if not previously filed) for tax years covered by the voluntary disclosure
necessary to correct the underreporting of assets held in or transferred through
undisclosed foreign accounts or foreign entities

http://www.irs.gov/Individuals/International-Taxpayers/Offshore-Voluntary-Disclosure-Pr... 1/15/2013

Offshore Voluntary Disclosure Program Submission Requirements

13.

Returns involving Passive Foreign Investment Company (PFIC) issues. A
statement whether the amended returns involve PFIC issues during the tax years
covered by the OVDP period, and if so, whether the applicant chooses to elect the
alternative to the statutory PFIC computation that resolves PFIC issues on a basis that is
consistent with the mark to market (MTM) methodology authorized in IRC § 1296 but
does not require complete reconstruction of historical data. A description of this
alternative method is included in FAQ 10.

14.

Applicants with Canadian registered retirement savings plans (RRSP) or
registered retirement income funds (RRIF) who wish to make late elections to
defer U.S. tax on RRSP or RRIF earnings:
z
z
z

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A statement requesting an extension of time to make an election
Forms 8891 for all tax years and type of plan covered under the voluntary disclosure
A dated statement signed by the taxpayer under penalties of perjury describing:
z
z
z

Events that led to the failure to make the election
Events that led to the discovery of the failure
If the taxpayer relied on a professional advisor, the nature of the advisor’s
engagement and responsibilities

Page Last Reviewed or Updated: 24-Aug-2012

http://www.irs.gov/Individuals/International-Taxpayers/Offshore-Voluntary-Disclosure-Pr... 1/15/2013