1. The IRS will shortly release a new FAQ for guidance of the program after OVDI 2011. Apparently it is now being called the offshore voluntary disclosure program ("OVDP"). For clarity, I refer to this as OVDP 2012.
2. Apparently, there will be an 8-year rolling period for amended returns required by the FAQ. I quote the article because, as I shall note, I am not sure I understand the point or, if I do understand the point, the logic of the point:
The upcoming FAQ will likely clarify the rolling eight-year period of returns due with the voluntary disclosure, said Jennifer Best, IRS senior attorney-adviser (services and enforcement), at New York University's annual Tax Controversy Forum in New York. "If the return is not yet due for a year, then that year is not included in the eight-year period," she said. The IRS also plans to clarify that compliant years' returns are not due as part of the disclosure, she said.
Scott D. Michel of Caplin & Drysdale said one area of confusion for practitioners had been how far back returns were due for taxpayers who were new to the program. Best confirmed that under the proposed clarification, taxpayers who have not yet filed a 2011 return do not include their 2011 return as part of the eight-year period, but taxpayers who filed a "false" 2011 return in April and then came into the OVDP in June must include a 2011 return.I interpret the words to mean, for example, if a false 2011 return has been filed when the taxpayer joins OVDP 2012, say on June 25 (more or less contemporaneous with mailing of the FBAR for timely filing), then the 8 year period is from 2004 to 2011. If the already filed 2011 return is not false (say the person was doing a "go-forward" but then changes his / her mind to join OVDP 2012, then the period is from 2003 to 2010. However, if the return is on extension when the taxpayer files for OVDP 2012 and not yet filed (so that when filed it will not be false), then the period is from 2003 to 2011. It seems to me that there can be some game playing there. For example, if 2003 is the high year, the taxpayer would want to file a false 2011 return and then join the program. There are some other strange results I can imagine, but maybe I just don't understand the comments are narrated in the article. Perhaps readers can enlighten me.