The IRS claims that the current Offshore Voluntary Disclosure Program rules present taxpayers faced with a potentially high IRS offshore penalty the chance to disclose their foreign assets voluntarily and accept an IRS Offshore Penalty of 27.5% or 50% and is intended to be a better option than facing the FBAR penalties themselves.
The IRS offshore penalty is reduced to 5% for Streamlined filers who live int he US. Meanwhile, expats have a 0% offshore penalty.