Update from Agent Bayer

1.  When asked about a higher standard for non -willful than in the case of SDOP, the agent complained that most of the Transition certifications they are receiving are incomplete and have to be send back - there is already a back-log of a few thousand submissions. I take this to mean err on the side of a complete if lengthy explanation vs. a brief explanation.

2. While the decision of a fresh SDOP or SFOP application appears to hinge on the willfulness - non willfulness barrier (i.e., negligence vs. intent), the IRS' decision on a OVDP-into-SFCP transitional request seems to depend on a stricter standard (based on Agent Bayer's comments). Whether that standard goes all the way down to the one between RC and NW, nobody knows yet. Even if it doesn't go all the way down there, it could very likely be the case that the audit option after opt-out is superior to a successful transition request (all else being equal) in terms of expected penalties.

3.  It seems still the mindset at the IRS that taxpayers in OVDP are mostly dishonest or it could be an indication of smart revenue management ! If you had a pool of people telling you that they'll give you 27.5% in a few months (ignoring those that intended to opt out), would you settle for 5% now ?
The IRS is looking more suspiciously to those particular individuals who were ready to pay the 27.5% .