IRS Streamlined Compliance Procedures for American expatriates

As per US law, all Americans have to file tax, irrespective of where they live as per their total worldwide income. But, a number of US expats may fail in filing their tax.

Well, the IRS has several amnesty programs for American expatriates. These programs enable you to catch up without any criminal action or penalties if you pay all the back taxes, interest, and IRS penalties.

streamlined compliance procedure

streamlined compliance procedure

The streamlined compliance procedure

A number of expats fail to file their taxes because they are unaware of the requirements to file taxes abroad, thus they can seek advantage of the streamlined procedure.

It is mandatory to file your last three federal tax returns and the last six foreign bank account reports. It is a way to certify that the non-compliance wasn’t consensual.

Expats can claim the Foreign Tax Credit for previous years. Hence, you won’t owe them any back taxes. If the expats follow the Streamlined Procedure rules, they will not face any penalties from IRS or FinCEN.

Foreign Bank Account Report

Any American with balance more than $10,000 in aggregate in foreign accounts (be it in investment, pension or bank account) that has signatory authority even if it is not registered in their name, at any point of time during a year will have to file an FBAR.

The Delinquent FBAR submission processes allow expats who are late in filing FBAR but updated with US Tax filing fill it without any penalties.

Relief Procedure for some Former Citizens

Launched in 2019, it allows the Accidental Americans to renounce US citizenship without a TIN Number or social security number.

Accidental Americans are those who possess the right to stay in the US but haven’t lived here or possess a US passport. It helps the citizens to catch up with their American tax filing and renounce citizenship without making any payment for back taxes and penalties.

So, all in all, there are a lot of ways for the expats to catch up without paying penalties or back taxes. Expats should take the help of US tax filing professionals to ensure that they catch up in the right way.


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