The Current Status of SFCP

• IRS will handle the tax forms submitted according to SFCP with the same procedures as those of normal tax forms. The probability of being investigated will not increase. You only need to prove that there is no intentional act of violation leading to arrears of taxes and pay for all arrears of taxes. Taxpayers who have previously made Quiet Disclosure may request to go through SFCP, but the previously paid tax fines are not refundable. Also, taxpayers who are being investigated are not eligible to apply to SFCP.

• In addition, from July 1, 2014, the threshold of income tax under USD1,500 was abolished. And, there is no need to fill out the risk survey questionnaire and risk analysis is no longer conducted.

The Standards of Compliance

• The standards for taxpayers living offshore (e.g. China, Hong Kong, and Taiwan) are as follows: Taxpayers need to prove that it is not intentional that there is no timely filing, and complete the income tax forms for the three-year arrears of taxes, information report and the Report of Foreign Bank and Financial Accounts (FBAR) for the six-year arrears of overseas asset tax. IRS will likely cancel all the fines for previously delayed filing and payment.

• The standards for taxpayers living in the US are as follows: The tax returns of the past three years must be amended and FBAR for the six-year arrears of overseas asset tax must be completed. The unpaid taxes and 5% FBAR fine need to be paid. If all information proves to be non-fraudulent or unintentional, the taxpayer will be exempt from further fines.