There is still time to obtain tax relief (and relief from criminal charges) for those with unreported foreign bank accounts.

The deadline for participating in the IRS’ Offshore Voluntary Disclosure Initiative (OVDI) is August 31, 2011. Under this program, the IRS is giving taxpayers an opportunity to report their foreign bank accounts without facing criminal sanctions. One thing we do know is that some people are simply too fearful and are not going to come forward because they are not willing to face the consequences. However, some tax professionals believe that the risks are multiplied for those that are not willing to participate in this initiative. The rationale is that the IRS must work even more aggressively to catch and prosecute the non-participants in order for the initiative to work. If not, then it will not seem that the participants received any benefit by disclosing their foreign bank accounts.

For information on obtaining an extension on submitting your FBAR filings, see Question 25.1 of the IRS’ Q&A page.