IRS Issues More Guidance on Streamlined Procedure for Non-Resident, Non-Filer U.S. Taxpayers, Possible Alternative to 2012 OVDP
In June, we wrote about the IRS announcement of a new program available in addition to the 2012 Offshore Voluntary Disclosure Program, which would be available in limited circumstances to certain taxpayers meeting IRS criteria. The IRS has now formally announced and outlined a procedure available for non-resident U.S. taxpayers who: (i) have resided outside of the U.S. since January 1, 2009; and (ii) have not filed a U.S. tax return during the same period. In order to qualify for the new procedure, the subject taxpayers must also present a low-compliance risk (defined as less than $1500 of tax due for the appropriate years and an absence of high risk factors, such as current audit or investigation or previous FBAR penalties).
The announcement detailing this program appears here.
To participate, the main requirements are the filing of amended returns for the last three years of noncompliance, the filing of FBARS for the last six years of noncompliance, and filling in a brief taxpayer questionnaire.
If the facts of your situation fit within the IRS parameters, this program may be a viable alternative for you to the 2012 Offshore Voluntary Disclosure Program. As with any other legal decision, you should contact a professional to determine your options.