Voluntary Disclosures

Voluntary Disclosures

At Diosdi & Liu, LLP, we take the position that the most effective way to resolve a criminal tax case is to avoid them

While we realize that this is not always possible, in certain circumstances, if you filed tax returns omitting taxable income, filed tax returns incorrectly, or failed to file tax returns, it may be possible to make a “voluntary disclosure” to the Internal Revenue Service. In some cases, making a voluntary disclosure to the Internal Revenue Service may be the only feasible method to avoid criminal prosecution for tax crimes. With that said, the rules governing voluntary disclosures are constantly changing. At one time, the Internal Revenue Service had a formally recognized “voluntary disclosure” policy. Under this policy, an individual or business that failed to file a tax return or pay tax due could escape criminal prosecution through voluntary disclosure, so long as it was voluntary and made before an investigation was commenced. The Internal Revenue Service withdrew this formal program.

Recently, the Internal Revenue Service revived the voluntary disclosure program. Voluntary disclosure submissions are now made to a centralized unit. Under current practices, the Internal Revenue Service recognizes that an individual or business may still avoid prosecution by voluntarily disclosing a tax violation, provided that the disclosure is (1) timely and (2) voluntary. The voluntary disclosure must be truthful and complete, and the individual must cooperate with the Internal Revenue Service personnel in determining the correct tax liability.

If you failed to file tax returns or believe that you filed incorrect tax returns, contact the attorneys at Diosdi Ching & Liu, LLP for a consultation. We will carefully review your facts and circumstances to determine if you should consider making a voluntary disclosure to the Internal Revenue Service.