Israeli Bank Account Owners Readmitted to OVDP

Although the IRS won’t comment on the reason Bank Leumi customers were kicked out of the IRS’ Offshore Voluntary Disclosure Program (OVDP) after not only being accepted into the program, but after some had already received a final clearance and paid the amounts due to the IRS, it is suspected that the IRS admitted the taxpayers into the program in error.  If a taxpayer is already under audit or investigation, he won’t be admitted into OVDP.  Once admitted, a taxpayer can be removed if he does not cooperate with the government or makes false statements with regard to the disclosure.  Since some of these taxpayers were readmitted, it is likely they were originally admitted in error.  Regardless, the right result was reached with this reversal if the IRS wants taxpayers to continue to come forward and disclose offshore accounts.