OVDP Objections: Top Nine Reasons To Avoid IRS OVDP


We have talked with over a thousand people that have undisclosed foreign accounts and foreign income. We have learned a lot since the first Offshore Disclosure Initiative in 2009. It is our position that the IRS is the most powerful collection agency in the world. Truth, justice, liberty, limited government…well, those are all nice ideas, but the fact is that we are all supplicants of the IRS. And that includes those with unreported income and unreported FBARs, the IRS says, use the OVDP. No matter how unfair it may seem.


Not everyone understands this so we, as counselors, find ourselves in the position of having to "sell" the IRS Offshore Voluntary Disclosure Program. Not that we think the OVDP is fair or equitable, or is even constitutionally permissible. But when faced with two bad alternativesc – the OVDP or rolling the dice, OVDP comes out ahead. That's our opinion anyway. Gambling with the IRS, especially when the stakes are so high, just doesn't make sense to us. Maybe you disagree. But to help you make sense of what is the best course of action, here are the most common objections we hear.


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IRS CP2000 Letter: An “Audit” On Stock And Mutual Fund Sales


Were you issued an IRS CP 2000 Letter for stock sales or mutual funds? The IRS has new enhanced stock sales reporting, but this does not help taxpayers who purchased stock prior to 2011. The IRS only mandates that brokerage houses report cost basis on the sale of stock and mutual funds purchased after 2011. While this change helps millions of taxpayers who sold stock that they purchased after 2011 avoid the dreaded CP 2000 letter, this does not help people who sold stock purchased before 2011 and have had recent gains. 


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Can you file an Offer in Compromise on a IRS trust fund recovery penalty?

If you have been assessed a trust fund recovery penalty by the IRS for unpaid employment taxes, you certainly must feel up against it. The IRS is aggressive on assessing and collecting trust fund taxes. The amount the IRS is seeking to extract from you can get sky high, very quickly. So what are your options? There is good news — you can file an Offer in Compromise (OIC) to settle the taxes that you owe.


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OVDI/OVDP Opt-Out FAQ: Your Top Questions Answered

Since the “opt-out” process was first introduced in the 2011 Offshore Voluntary Disclosure Initiative (OVDP/OVDI), we have helped countless US taxpayers and tax professional understand one of the most confusing aspects of the current OVDP, “the opt-out.” Here is our OVDI/OVDP Opt-Out …

Unfiled Tax Returns: Top Questions Answered

Many taxpayers have questions about unfiled tax returns, and rightfully so. Many have not filed tax returns for 10 years, or even 15 years, or maybe never. Many are worried about what the statute of limitations is on unfiled tax returns. They wonder if they should file if they owe the IRS money, or if it is better to wait until they can afford to pay the IRS. They are afraid of penalties and hope there is some sort of unfiled tax return forgiveness law.

Foreign Bank Account Report: IRS Sues For Civil Judgement

On June 11, 2013, the Assistant United States Attorney General Kathryn Keneally sued Carl R. Zwenker of Miami, Florida for penalties for not filing timely foreign bank account reports. While the complaint itself is rather short for a legal pleading, this lawsuit is incredibly significant for …

Unfiled IRS Tax Returns: Four Important Things To Know

Let’s talk about the 4 things you need to know about filing back taxes with the IRS. The first thing is that if you don’t file your taxes, the IRS will do something called a “substitute for filed return.” (or SFR). With an SFR, the IRS tries to assume the worst tax bill you can imagine. They send you notices…