Voluntary Disclosure Program for Taxpayers and CPAs
Voluntary disclosure can provide a way for taxpayers to proactively respond to situations in which there has been a breach of legal obligation with respect to taxes and which is not yet known to the regulatory agency—usually the IRS or a state revenue agency. Properly executed, a voluntary disclosure can allow a taxpayer to rectify the situation and can significantly reduce the penalty that would otherwise result if the breach were discovered through a governmental audit or discovery process.
Why should I consider working with an attorney on voluntary disclosure?
For areas where there is a clear violation, working with a Varnum attorney on a voluntary disclosure can provide a level of protection for both the CPA and the client under the attorney/client privilege. Oftentimes, CPAs are the first to become aware of a client's potential violation. On a proactive basis, we work with CPAs to help spot issues and to formulate a strategy that minimizes exposure to both the CPA and the taxpayer. If there is an investigation, the tax preparer will be asked if s/he spoke to the client about the violation. This type of question can place the CPA in a difficult position. We provide ways for you to approach areas of concern with clients whom you suspect have a potential problem.
Why should I work with Varnum?
Varnum's tax controversy professionals have significant experience in this area. Our team has received national recognition in tax law and tax litigation by one of the few law firm rating organizations that bases rankings on actual client research. We have successfully handled a wide range of matters with the IRS on behalf of all types of taxpayers. We have successfully completed many voluntary disclosure projects with the IRS and with more than 40 state revenue agencies. We work with you to evaluate whether a voluntary disclosure is right for your specific circumstances, and prepare and file a disclosure that minimizes exposure to potential civil and criminal penalties.
Our experienced team includes skilled technical attorneys and other professionals with previous experience including:
- Senior trial attorney for District Council of the IRS
- Special assistant U.S. attorney for the Department of Justice
- Legal counsel of the Michigan Department of Treasury
- Michigan Department of Treasury audit manager
- IRS special agent and revenue agent
- Certified public accountant designation
How will Varnum work with me and my client?
We've been doing this work for more than 25 years. We strive to keep matters and identities confidential and out of the headlines, preserving your client's confidentiality and possibly their financial and personal reputation. In many cases, we will be able to retain you to serve as an expert during the process so you can continue to assist your client while we work through the voluntary disclosure.
If you are aware of potential reporting issues in your client's business, do not hesitate to contact us. We can provide guidance on the most appropriate course of action.
News & Publications
- January 16, 2017
- Tax Blog Post, March 18, 2019
- Tax Insights, February 7, 2019
- Tax Advisory, December 5, 2018
- Tax Advisory, March 15, 2018
- Tax Advisory, December 11, 2017
- IRS Dirty Dozen for 2017, Tax Shelters, and Captive Insurance: Attacking Past Problems Using a Voluntary Disclosure StrategyTax Insights, April 5, 2017
- Tax Insights, April 26, 2016
- Tax Article, April 22, 2016