IRS Voluntary Disclosure Program | Tax Attorneys in Roseville, CA

What Is the IRS Voluntary Disclosure Program?

The IRS Voluntary Disclosure Program (VDP) — sometimes called the Voluntary Disclosure Practice — is a longstanding IRS policy that allows eligible taxpayers with criminal exposure to come forward, disclose past non-compliance, pay back taxes and interest, and negotiate reduced penalties in exchange for a commitment not to refer the matter for criminal prosecution.

Voluntary disclosure does not guarantee immunity from prosecution, but a timely, accurate, and complete disclosure has historically provided meaningful protection for qualifying taxpayers who act before the IRS initiates an investigation.

Who Should Consider Voluntary Disclosure?

Voluntary disclosure may be appropriate for individuals and businesses who have unreported income, unfiled tax returns, unreported foreign accounts (FBAR/FATCA non-compliance), or other tax compliance failures that could give rise to criminal liability. The program is available to both domestic and international taxpayers with U.S. tax obligations.

Critically, voluntary disclosure is only available to taxpayers who have not yet been contacted by the IRS regarding the issue being disclosed. If an audit or investigation has already begun, other resolution options may apply.

The Disclosure Process

The voluntary disclosure process involves notifying the IRS of your intent to disclose, submitting all required returns and amended returns, paying the tax owed plus interest, and negotiating a closing agreement that resolves civil penalties. The process requires careful preparation — incomplete or inaccurate disclosures can result in rejection and increased exposure.

Our attorneys guide clients through every step, from evaluating whether disclosure is appropriate to preparing the submission and negotiating the final resolution.

Foreign Account Disclosure

For taxpayers with unreported foreign financial accounts, the IRS Voluntary Disclosure Program and the Streamlined Filing Compliance Procedures (for non-willful violations) provide pathways to come into compliance while minimizing penalties. Penalties for willful FBAR violations can be severe — in some cases exceeding the account balance itself — making early, voluntary action critical.