We previously reported in our February 21, 2011 Legal Alert on two offshore voluntary disclosure programs initiated by the IRS to bring persons back into compliance who failed to report an interest in, or signature authority over, one or more offshore financial accounts. These reporting requirements are generally referred to as the “FBAR” reporting requirements. The first program ran from March 23, 2009 thru October 15, 2009 (2009 OVDP), the second program ran from February 8, 2011 thru September 9, 2011, with an extension for certain supplemental information to be provided by December 9, 2011 (2011 OVDI).

The IRS just announced a third offshore voluntary disclosure program (2012 OVDP) to assist taxpayers in reporting their offshore accounts. The 2012 OVDP is similar to 2011 OVDI, but has a few major distinctions. First, there is no set deadline for taxpayers to enter 2012 OVDP. However, taxpayers are cautioned that the IRS may change the terms of 2012 OVDP at any point, including by increasing penalties or ending the program entirely...