There are many Americans, who may have lived for years outside the US, who are fully compliant with their tax affairs in the country in which they live but may have been unaware of their continued requirement to file US tax and information returns. There is also a category of ‘accidental’ American unaware of their US citizenship let alone their requirement to file tax returns. These individuals should be considering voluntary disclosure (approaching the IRS before they are found).
In an environment where legislation has been enacted that gives the US authorities unprecedented reach beyond their own borders and with a recent history of voluntary disclosure programs offered by the IRS, non-compliant taxpayers should be giving very serious consideration to getting back into the US tax system.
There are very broadly three voluntary disclosure options available. Two of these fall within formal IRS administrative programs: the 2012 Offshore Voluntary Disclosure Initiative (OVDI) and (as of 1 September 2012) the streamlined procedure for “low compliance risk” cases. The third option is to file late tax returns outside of the programs because either you do not meet the criteria to enter into them, or because the voluntary disclosure programs themselves are not appropriate to your circumstances.
We are able to help advise non-compliant US taxpayers on voluntary disclosure and the options available to them in achieving the goal of getting (back) into the system.
For a more in depth discussion of the options available please follow this link.