The New IRS Voluntary Disclosure Regime: Worth The Price Of Admission?

Fox Rothschild LLP
Contact

Fox Rothschild LLP

Following the termination last fall of its immensely successful Offshore Voluntary Disclosure Program (OVDP), the Internal Revenue Service (IRS) has announced a new regime to govern all voluntary disclosures regarding tax noncompliance. These new procedures apply to both domestic and offshore voluntary disclosures, and in many ways they replicate the procedures under the now-shuttered OVDP.

In other ways, the new procedures are significantly different, particularly the new civil penalty framework. Taxpayers who now take advantage of the updated voluntary disclosure program will potentially face a 50 percent penalty on their undisclosed offshore financial assets, and a 75 percent civil fraud penalty on the unpaid taxes, and both of these penalties can, in certain circumstances, be applied for multiple years. In addition, the new procedures place greater emphasis on taxpayer cooperation during the voluntary disclosure process, and make clear that non-cooperative taxpayers may face greater penalty exposure. This significantly more stringent penalty framework may well cause some taxpayers to question whether the new program is worth the price of admission, especially when other voluntary disclosure options continue to exist.

Voluntary Disclosure Background

The IRS has for years maintained a self-disclosure regime whereby taxpayers can voluntarily disclose instances of noncompliance with the tax laws and in most cases avoid criminal prosecution. The critical underlying principal of voluntary disclosure is that the taxpayer must self-disclose before the IRS learns of the noncompliance; if the IRS already knows of the taxpayer’s noncompliance from whatever source (for example, from third-party reporting or a whistleblower), the taxpayer is ineligible to make a voluntary disclosure.

In March 2009, following the landmark agreement regarding offshore tax evasion struck by the United States with Switzerland’s largest bank, UBS AG, the IRS unveiled its now-famous “Offshore Voluntary Disclosure Program.” This was a specially-designed voluntary disclosure program – premised upon the IRS’s longstanding voluntary disclosure practice – for taxpayers with secret foreign bank accounts and other types of offshore financial assets. Participating taxpayers were required to file eight years of amended tax returns and to pay all back taxes, interest, and a “miscellaneous” offshore penalty calculated at 20 percent of the aggregate highest balance of undisclosed offshore financial assets. The IRS subsequently announced various modifications to the OVDP in 2011, 2012, and 2014, with the primary change each time consisting of an elevation of the penalty rate, which ultimately reached 27.5 percent in the 2014 iteration. In addition, under certain circumstances, the miscellaneous penalty could be elevated to 50 percent if the taxpayer maintained an account at a financial institution, or did business with an offshore service provider, identified on a list maintained by the IRS.

The OVDP was designed for taxpayers with exposure to potential criminal liability or substantial civil penalties due to a willful failure to report foreign financial assets and pay all tax due associated with those assets. The OVDP provided taxpayers with such exposure potential protection from criminal liability and terms for resolving their civil tax and penalty obligations. Taxpayers with unfiled returns or unreported income who had no exposure to criminal liability or substantial civil penalties due to willful noncompliance could come into compliance using other options, including the Streamlined Filing Compliance Procedures, the delinquent FBAR submission procedures, or the delinquent international information return submission procedures.

By the time the OVDP ended in September 2018, more than 56,000 taxpayers successfully completed the program, paying more than $11.1 billion in back taxes, penalties and interest. The total number of taxpayer disclosures under the OVDP peaked in 2011, when about 18,000 individuals came forward. In addition, more than 65,000 taxpayers took advantage of the Streamlined Filing Compliance Procedures, a related voluntary disclosure initiative unveiled in 2014 as an alternative to OVDP for taxpayers whose conduct was non-willful. Collectively, the OVDP and the Streamlined Filing Compliance Procedures represented the most successful voluntary disclosure program ever offered by the IRS, far eclipsing all prior initiatives. Participation in OVDP declined in recent years, however, with only 600 disclosures occurring during 2017, prompting the IRS to announce that the program would close as of September 28, 2018.

Highlights of the New Voluntary Disclosure Regime

On November 20, 2018, the IRS announced the new voluntary disclosure procedures by releasing publicly a five-page internal guidance memorandum. These new procedures are effective for all voluntary disclosures – both offshore and domestic – received after September 28, 2018. The objective of the new voluntary disclosure practice is to provide taxpayers concerned that their conduct is willful or fraudulent, and that may rise to the level of tax and tax-related criminal acts, with a means to come into compliance with the law and potentially avoid criminal prosecution. The guidance emphasizes that taxpayers who did not commit any tax or tax related crimes and do not need the voluntary disclosure practice to seek protection from potential criminal prosecution can continue to correct past mistakes using the Streamlined Filing Compliance Procedures or by filing an amended or past due tax return.

Preclearance by IRS-Criminal Investigation

As with the OVPD, IRS-Criminal Investigation will screen all voluntary disclosure requests (whether domestic or offshore) to determine if a taxpayer is eligible to make a voluntary disclosure. To do so, the IRS will require all taxpayers wishing to make a voluntary disclosure to submit a preclearance request on a forthcoming revision of Form 14457. Internal Revenue Manual section 9.5.11.9 will continue to serve as the basis for determining taxpayer eligibility. If IRS-CI determines that the taxpayer satisfies the voluntary disclosure requirements, it will issue a “preclearance letter” to the taxpayer.

For all cases where IRS-CI grants preclearance, taxpayers must then promptly submit all required voluntary disclosure documents using a forthcoming revision of Form 14457. This form will require information related to taxpayer noncompliance, including a narrative providing the facts and circumstances, assets, entities, related parties, and any professional advisors involved in the noncompliance. Once IRS-CI has received and preliminarily accepted the taxpayer’s voluntary disclosure, it will notify the taxpayer of preliminary acceptance by letter and simultaneously forward the voluntary disclosure letter and attachments to the IRS Large Business & International unit in Austin, Texas, for case preparation before examination. As with the OVDP, IRS-CI will not process tax returns or payments.

Civil Processing and Case Development

Once the LB&I Austin unit receives information from IRS-CI, it will route the case for audit. If a taxpayer or representative wishes to make a payment prior to case assignment with an examiner, payments may be remitted to the LB&I Austin unit. The LB&I Austin unit will select the most recent tax year covered by the voluntary disclosure for examination and then forward cases for case building and field assignment to the appropriate Business Operating Division and Exam function for civil audit. All voluntary disclosures will follow standard audit procedures. Examiners will be required to develop cases, use appropriate information-gathering tools (such as Information Document Requests and summonses, as appropriate), and determine proper tax liabilities and applicable penalties.

Six-Year Disclosure Period in Most Cases

In general, voluntary disclosures will include a six-year disclosure period, which means that participating taxpayers will be required to file corrected tax returns for the most recent six-year period, even if their tax noncompliance covered a greater period of time. However, IRS agents have the discretion to expand the disclosure period to cover additional years – including what the IRS calls “the full duration of the noncompliance” – if the taxpayer refuses to resolve the audit by agreement. In addition, cooperative taxpayers may be allowed to expand the disclosure period to include additional tax years in the disclosure period for various reasons (such as correcting tax issues with other tax authorities that require additional tax periods, correcting tax issues before a sale or acquisition of an entity, or correcting tax issues relating to unreported taxable gifts in prior tax periods).

Importance of Taxpayer Cooperation

The new voluntary disclosure procedures are notable for the emphasis they place on taxpayer cooperation, and perhaps more importantly, the consequences to taxpayers of non-cooperation. The IRS’s historical voluntary disclosure process has always required taxpayer cooperation, specifying that “[a] voluntary disclosure occurs when the communication is truthful, timely, complete, and when . . . the taxpayer shows a willingness to cooperate (and does in fact cooperate) with the IRS in determining his or her correct tax liability.” Similarly, the OVDP required taxpayer cooperation as a condition of participating in the program, which included making full disclosure of all offshore assets; agreeing to extend the applicable statutes of limitations; and fully paying all back taxes, interest, and penalties, or making satisfactory payment arrangements.

Under the new procedures, taxpayer cooperation takes on greater significance, and by “cooperation” the IRS means more than just making full disclosure of offshore assets, extending the time to assess, and arranging for payment. Rather, the extent of a taxpayer’s cooperation (or lack thereof) will have a direct bearing on the type and magnitude of penalties to be asserted. The new guidance states that the IRS expects that voluntary disclosures will be resolved by agreement with full payment of all taxes, interest, and penalties for the disclosure period. In other words, taxpayers are expected to assent to all adjustments that result from the audit, and not to exercise their legal rights to contest audit adjustments and seek review by IRS Appeals. In particular, taxpayers are warned that in cases that are not resolved by agreement (and the taxpayer exercises his or her right to take the case to Appeals), the agent “may assert maximum penalties under the law with the approval of management” and may expand the disclosure period beyond six years. Also, if a taxpayer fails to cooperate with the civil examination, the examiner may request that IRS-CI revoke preliminary acceptance, potentially triggering the opening of a criminal investigation.

Penalty Framework

The new voluntary disclosure procedures make clear that the nature and extent of penalties to be assessed will in large part be a function of the taxpayer’s cooperation during the process. As noted above, taxpayers whose cases that are not resolved by agreement can face “maximum penalties under the law.” On the other hand, taxpayers who provide “prompt and full cooperation during the civil examination of a voluntary disclosure” are entitled to civil penalty mitigation.

The following penalty terms will be applied to taxpayers who make timely voluntary disclosures and who fully cooperate with the IRS during the voluntary disclosure process:

Civil Fraud Penalty
The civil penalty under I.R.C. § 6663 for fraud or the civil penalty under I.R.C. § 6651(f) for the fraudulent failure to file income tax returns will apply to the one tax year with the highest tax liability. In limited circumstances, the IRS may apply the civil fraud penalty to more than one year in the six-year scope (up to all six years) based on the facts and circumstances of the case, for example, if there is no agreement as to the tax liability. The IRS may assert the civil fraud penalty beyond six years if the taxpayer fails to cooperate and resolve the examination by agreement. The new procedures provide that taxpayer may request imposition of accuracy-related penalties under I.R.C. § 6662 instead of civil fraud penalties, although granting such requests is expected to be exceptional. Where the facts and the law support the assertion of the civil fraud FBAR penalty, a taxpayer must present convincing evidence to justify why such penalty should not be imposed.

FBAR Penalty
Willful FBAR penalties will be asserted in accordance with existing IRS penalty guidelines contained in the Internal Revenue Manual, which include mitigation guidelines that permit the IRS to reduce FBAR penalties if certain criteria are met. Taxpayers may request that the IRS impose non-willful FBAR penalties, but granting such requests is expected to be exceptional, and taxpayers must present convincing evidence to justify lower penalties.

Information Return Penalties
The new voluntary disclosure procedures provide that penalties for failure to file information returns will not be automatically imposed. This is a positive development for taxpayers, as the penalties for not filing information returns such as Forms 5471 (requiring disclosure of ownership of foreign corporations), Forms 8938 (requiring disclosure of foreign financial assets), and Forms 3520 (requiring disclosure of information regarding foreign trusts), can be significant, especially if the taxpayer’s noncompliance spans multiple years. The procedures provide that agents will exercise discretion as to these types of penalties and will take into account the application of other penalties (such as the civil fraud penalty and the willful FBAR penalty) and the extent of the taxpayer’s cooperation.

Other Penalties
Other types of penalties, such as those relating to excise taxes, employment taxes, and estate and gift taxes, will be handled based upon the facts and circumstances with IRS agents coordinating with appropriate subject matter experts.

Ability to Request an Appeal

In a break from prior practice under the OVDP, the new voluntary disclosure procedures provide that taxpayers retain the right to request an appeal with the IRS Office of Appeals. Taxpayers accepted into the OVDP were not permitted to request an appeal under any circumstances; the only recourse for taxpayers who did not wish to accept the OVDP civil resolution terms was to “opt-out” of the program and face a full-scope audit. The ability to take an appeal is another positive development for taxpayers under the new voluntary disclosure procedures, but this is a double-edged sword. It appears that taxpayers who exercise their appeal rights – one of the fundamental rights enumerated in the “Taxpayer Bill of Rights” – will be deemed non-cooperative and can face imposition of greater penalties than taxpayers who agree to resolve their voluntary disclosure cases and do not appeal.

Application of the New Civil Penalty Framework

As noted, the new voluntary disclosure procedures are described in a five-page internal guidance memorandum released in November. The IRS has not yet published any additional guidance on how the new program will work in practice, such as Frequently Asked Questions which were a large part of the OVDP and largely helpful to taxpayers and practitioners.

At the American Bar Association’s National Institute on Criminal Tax Fraud and National Institute on Tax Controversy in December 2018 – held only a few weeks after the IRS issued the new voluntary disclosure guidance – an attorney from the IRS Office of Chief Counsel presented the following three scenarios to illustrate how the new voluntary disclosure penalty framework will be applied to various fact patterns.

Hypothetical 1

Taxpayer 1 is a US citizen who lives in California, but he was born in Italy and lived in Italy for parts of his adult life. Taxpayer 1 has several bank accounts in Italy and a Swiss bank account established by his grandfather’s estate for Taxpayer l’s inheritance. Taxpayer 1 accessed the Swiss account and never informed the Swiss bankers of his US citizenship. Taxpayer 1 had no interests in or control over any foreign entities. He intentionally did not tell his return preparer about his foreign bank accounts and checked “no” to the question about having foreign bank accounts on Schedules B filed with his tax returns.

Taxpayer 1 fully cooperates with the civil examination. The examiner asserts the civil fraud penalty for one year and a willful FBAR penalty totaling 50% of the highest aggregate balance in all foreign bank accounts.

This scenario represents what appears to be a relatively straightforward case of willful conduct by the taxpayer, as evidenced by the taxpayer’s deliberate concealment of his offshore accounts from his return preparer and his “no” answer to the question about foreign bank accounts on Schedule B. The taxpayer is cooperative during the examination, and presumably resolves the audit by agreement (and does not request an appeal). Because the taxpayer’s conduct was willful, the IRS revenue agent asserted a one-year civil fraud penalty and a one-year willful FBAR penalty.

Hypothetical 2

Taxpayer 2 owns a restaurant in Dallas as a sole proprietorship. Taxpayer 2 reports all credit card receipts, but only 20% of cash receipts. Taxpayer 2 kept a second set of books tracking his actual income. Taxpayer 2 had no other tax or information reporting noncompliance. Taxpayer 2 used the unreported cash to pay various personal expenditures and to buy gold bullion. Taxpayer 2 accumulated $2 million in gold bullion in his personal safety deposit box over the last 10 years with his cash skimming scheme. In Taxpayer 2’s voluntary disclosure letter to CI he expresses willingness to sell his bullion to pay all outstanding tax liabilities if he doesn’t have sufficient liquid assets to pay his taxes. Taxpayer 2 fully cooperates including providing his second set of books tracking his actual income to the examiner. The examiner asserts the civil fraud penalty for one tax year.

This scenario, which involves solely domestic conduct, demonstrates the value that the IRS will place on taxpayer cooperation during the voluntary disclosure process. The scenario presents numerous examples of fraudulent conduct by the taxpayer, including a typical “cash skim,” maintaining a second set of books, payment of personal expenses, and accumulation of a “cash hoard” (albeit in the form of gold bullion). Outside of the voluntary disclosure process, an IRS agent would undoubtedly assert the civil fraud penalty for multiple years. Because this is a voluntary disclosure case, the civil fraud penalty is limited to a single year, a significant concession to the taxpayer.

Hypothetical 3

Taxpayer 3 is a US citizen who lives in New York. Taxpayer 3, through nominees, owned 100% of a Panamanian corporation that held several foreign financial accounts in Singapore and interests in two businesses in China. Taxpayer 3 willfully and fraudulently failed to disclose his ownership of the CFC and his control over the foreign financial accounts. Taxpayer 3 actively traded securities and held mutual funds in one of the foreign financial accounts. During the course of the examination, Taxpayer 3 and the IRS cannot agree on the proper PFIC tax calculations for the last three years of the six-year disclosure period and transition tax under Section 965. Taxpayer 3’s positions on the issues are made in good faith and are non-frivolous. The examiner and her manager coordinated the issues internally and disagree with Taxpayer 3. Although agreement is not reached on those years, Taxpayer 3 fully cooperates throughout the examination including providing all documents requested and answering questions in an interview. Taxpayer 3 requests review by the Office of Appeals. The examiner asserts the civil fraud penalty for the last three years of the disclosure period and a willful FBAR penalty totaling 65% of the highest aggregate balance in all foreign bank accounts.

This scenario presents the most objectionable application by the IRS of the new voluntary disclosure penalty framework. The taxpayer’s conduct in this hypothetical is unquestionably willful, as evidenced by the taxpayer’s use of nominees to hold offshore accounts in tax haven countries and deliberate concealment of ownership of a controlled foreign corporation and control over foreign accounts. During the audit, the taxpayer fully cooperates but cannot reach an agreement with the agent as to a technical issue relating to application of the highly complex passive foreign investment company (PFIC) rules. The audit is resolved on an unagreed basis, and the taxpayer exercises his legal right to review by IRS Appeals. Despite the taxpayer’s assertion of a good faith, non-frivolous position regarding the PFIC issue, the IRS agent asserts a whopping array of penalties consisting of three years of civil fraud (a 225-percent penalty in total) and multiple willful FBAR penalties that total 65 percent in the aggregate. Taxpayers should not be punished for asserting good-faith legal positions and seeking review by IRS Appeals, but this scenario makes clear that taxpayers who do so will face what can only be described as retaliatory penalty assertions by IRS agents.

Other Voluntary Disclosure Options Still Exist

It is important to note that the new voluntary disclosure regime unveiled in November is not the only pathway for noncompliant taxpayers. Other viable, and less expensive, voluntary disclosure options still remain available depending, of course, on individual facts and circumstances. As noted, the highly-popular Streamlined Filing Compliance Procedures may still be used by taxpayers whose conduct was non-willful. For taxpayers whose only noncompliance was omission of certain information returns, the Delinquent FBAR Submission Procedures and the Delinquent International Information Return Submission Procedures are good options. Finally, although the IRS discourages the practice, taxpayers may still make so-called “quiet” disclosures by filing amended tax returns and following the procedures described in section 9.5.11.9 of the Internal Revenue Manual.

Conclusion

The new IRS voluntary disclosure regime is a mixed bag for taxpayers and practitioners. On the one hand, they should be welcomed by taxpayers and practitioners because they make clear that voluntary disclosure practice for both domestic and offshore issues is alive and well despite closure of the OVDP. On the other hand, the new procedures dramatically increase the range of available penalties as compared to OVDP and authorize IRS revenue agents ostensibly to punish non-cooperating taxpayers by significantly ratcheting up the potential penalty exposure, even when taxpayers assert good faith positions and/or seek to exercise their appeal rights. The increased price of admission may well discourage taxpayers from making formal voluntary disclosures and instead drive taxpayers into using other options, such as the Streamlined Filing Compliance Procedures or quiet disclosures.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Fox Rothschild LLP | Attorney Advertising

Written by:

Fox Rothschild LLP
Contact
more
less

Fox Rothschild LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at www.jdsupra.com) (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at privacy@jdsupra.com.

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.