Is the OVDP a Good Deal? Assessing the OVDP in Terms of FBAR Willfulness

65 Pages Posted: 12 Dec 2013

See all articles by Eliezer Mishory

Eliezer Mishory

George Washington University - Law School

Date Written: November 26, 2013

Abstract

This Note argues that the OVDP’s value depends on the taxpayer’s exposure to willful FBAR penalties. This Note also provides a guide to willfulness in FBAR violations. The OVDP is a program that the IRS adopted as part of its recent crackdown on taxpayers with undisclosed offshore bank accounts. The OVDP provides taxpayers with amnesty from willful FBAR penalties. On the other hand, entering the OVDP can be an expensive and protracted ordeal. For taxpayers with a high risk of facing willful FBAR violations, the OVDP is a good deal. For other taxpayers, the OVDP is an unnecessary ride. Deciding whether or not to enter the program is difficult because there is a dearth of guidance regarding what makes an FBAR violation willful. There are very few criminal FBAR cases and there are only two civil FBAR cases. This Note examines judicial guidance on willfulness in other contexts and extrapolates principles of willfulness that apply to FBAR violations. Using these principles, this Note examines the FBAR cases to identify current judicial thinking on FBAR willfulness. This exercise indicates that there is currently a strong inclination to find that FBAR violations are willful. This makes entering the OVDP more compelling and a better deal for taxpayers than it may seem.

Keywords: OVDP, Offshore, BSA, FBAR, Willful, Cheek, Ratzlaf, Williams, Mcbride, Bank Secrecy, IRS, Tax, IRC, IRM

Suggested Citation

Mishory, Eliezer, Is the OVDP a Good Deal? Assessing the OVDP in Terms of FBAR Willfulness (November 26, 2013). Available at SSRN: https://ssrn.com/abstract=2365986 or http://dx.doi.org/10.2139/ssrn.2365986

Eliezer Mishory (Contact Author)

George Washington University - Law School ( email )

2000 H Street, N.W.
Washington, DC 20052
United States

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