Important Changes Could Be Coming to the IRS’ Voluntary Disclosure Program (VDP) in 2026

The Internal Revenue Service (IRS) has proposed some significant changes to its longstanding Voluntary Disclosure Program (VDP). If finalized, these changes could take effect later in the year and significantly impact taxpayers’ decisions on whether to submit voluntary disclosures. Learn more from New York criminal tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group:

About the IRS’ Voluntary Disclosure Program

The Voluntary Disclosure Program (VDP) provides a pathway for U.S. taxpayers to resolve willful tax law violations with the IRS. Submitting a voluntary disclosure does not guarantee immunity from criminal prosecution, but by working with the IRS to come into compliance through the VDP, taxpayers can settle their federal tax controversies without facing criminal charges.

While coming into compliance through the VDP generally involves paying what taxpayers owe, facing criminal prosecution can lead to additional fines and federal prison time. In many cases, taxpayers prosecuted for tax crimes will face charges for money laundering, wire fraud, and other federal crimes. As a result, for taxpayers at risk of prosecution, resolving their tax controversies through the VDP is often the best option.

The Changes that Could Be Coming to the VDP Later in 2026

The VDP currently has strict eligibility criteria for submitting voluntary disclosures, receiving “preclearance” to participate in the program, and favorably resolving willful tax law violations with the IRS. However, the program’s eligibility criteria could become even stricter later this year. Some of the proposed changes the IRS is currently considering include:  

• New filing requirements for applying to participate in the VDP (including requirements to waive all applicable statutes of limitations and “identify all years of noncompliance and provide a full and accurate description of the taxpayer’s willful noncompliance”);
• New additional filing requirements once a taxpayer receives preclearance from the IRS (including requirements to file all required amended and delinquent returns and FBARs within three months); and,
• A new three-month deadline to execute all “required agreements” with the IRS and pay “all applicable taxes, penalties and interest in full,” once a taxpayer receives preclearance to participate in the VDP.

These changes (among others) are currently subject to public comment, and the public comment period is scheduled to close on March 22, 2026. After that, the IRS states that “the revised procedures are expected to take effect six months after publication of the final terms.” As a result, it is very possible that we could see significant changes to the VDP before the end of the year.

Talk to New York Criminal Tax Lawyer Kevin E. Thorn About Submitting a Voluntary Disclosure

If you have questions about submitting a voluntary disclosure to the IRS to resolve a willful tax law violation in 2026, we encourage you to contact us promptly for more information. To schedule a call with New York criminal tax lawyer Kevin E. Thorn, Managing Partner of Thorn Law Group, please call 914-534-6004 or contact us confidentially online today.