Overview

The 2011 Offshore Voluntary Disclosure Initiative (OVDI), that was announced by the US Internal Revenue Service (IRS) in February 2011, encourages taxpayers with unreported offshore assets and income to voluntarily disclose such assets and income in exchange for protection from criminal prosecution and reduced penalties.

Baker & McKenzie outlines the background of the 2009 OVDP as well as detailing the new points of the 2011 legislation. This includes:

• The 2011 OVDI penalty framework
• Examples illustrating the application of the 2011 OVDI penalty framework
• The procedure for making a voluntary disclosure under the 2011 OVDI
• Tax court review of additions to tax and penalties
• Special rules for taxpayers with Passive Foreign Investment Company (PFIC) interests

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