The US Treasury spends about 10 billion dollars a day. That works out to about $417 million dollars an hour. So, how many days of revenue did the much-hyped 2009 and 2011 IRS Offshore Initiatives (OVDI) bring in?
"DATELINE WASHINGTON: The Internal Revenue Service today reopened the offshore voluntary disclosure program to help people hiding offshore accounts get current with their taxes and announced the collection of more than $4.4 billion so far from the two previous international programs."
How seriously can we take the so-called tax gap, when two successful programs (both well-publicized, together, don't even pay for half a day of federal spending?
In related news, the IRS reopened the offshore voluntary disclosure program. (which, not to get too technical about, never actually closed. Because according to the Internal Revenue Manual (IRM) 9.5.11.9, a voluntary disclosure was always available post-August 31 2011 as long as neither the IRS or Department of Justice began an audit or investigation.) Unlike the 2009 and 2011 OVDIs, the just-released 2012 deal has no expiration date.
The new program will be like the 2011 OVDI except the highest penalty will move from a 25% FBAR penalty to a 27.5% FBAR penalty (The FBAR penalty is calculated on the highest aggregate balances). And like the 2011 OVDI, there is an opt-out program for taxpayers who unwillingly were in non-compliance.
2017 update
There are still Offshore Disclosure Programs available. Learn more about them here.
