IRS Amnesty – Streamlined Filing Compliance Procedure for delinquent filers

Jul 9, 2021 | IRS - Internal Revenue Service, US Tax Return 1040 / 1040NR | 0 comments

U.S. Persons (U.S. Citizens, Green Card Holders and Resident Aliens) are required to file annually regardless of where their income is earned, where in world they live, whether or not the U.S. has a Tax Treaty with that country and whether or not they also pay Foreign Taxes. For those U.S. persons that have not comply with the U.S. Fiscal Law in the past, the IRS has set up a streamlined procedure: an amnesty of all years not filed or filed incorrectly in the past. IRS Amnesty and if you file it this year 2020, you will also get at least $3,200 from the IRS on Stimulus Checks.

IRS Amnesty or the Streamlined Foreign Offshore Procedure.

The IRS Streamlined Foreign Offshore Procedure described below is available to taxpayers certifying that their failure to report foreign financial assets and pay all tax due in respect of those assets did not result from willful conduct on their part. The streamlined procedure is designed to provide taxpayers in such situations with:

  • A streamlined procedure for filing amended or delinquent returns,
  • Terms to resolve the tax and penalty procedure for filing amended or delinquent returns.
  • and the conditions for resolving the tax and criminal obligations.

As reflected below, the streamlined filing procedure that were first offered on September 1, 2012 has been expanded and modified to accommodate a broader group of U.S. taxpayers.

Taxpayers must certify that conduct was not willful. Taxpayers using the Streamlined Foreign Offshore Procedure, will be required to certify, in accordance with the specific instructions set forth below, that the failure to report all income, pay all tax and submit all required information returns, including FBARs (FinCEN Form 114, previously Form TD F 90-22,1) and Individual Tax Returns (Form 1040) was due to non-willful conduct.

The streamlined procedure can be very beneficial for taxpayers because they allow the taxpayer to comply with income tax rules and regulations in a relatively easy manner. The streamlined foreign offshore procedure will protect the taxpayer from having to pay various penalties, including the failure-to-file penalties, failure-to-pay penalties, accuracy-related penalties, information return penalties, and FBAR penalties. This protection from penalties will remain in place even if the amended tax returns are later selected for audit, unless the IRS demonstrates that the original tax noncompliance was fraudulent or that the failure to file FBAR reports was the result of willful behavior. However, if, during the examination, the IRS determines that an additional tax deficiency is due by the taxpayer, the taxpayer may at that point be subject to any applicable taxes and penalties for that additional deficiency.

U.S. taxpayers eligible to use the Streamlined Foreign Offshore Procedures must:

  1. File delinquent or amended US Tax Returns for each of the most recent 3 years for which the U.S. Tax Return due date has passed, together with all required information returns (e.g., Forms 5471, Form 8621 and 8938) and
  2. File any delinquent FBARs (FinCEN Form 114, previously Form TD F 90-22.1) for each of the most recent 6 years for which the FBAR due date has passed.

You can upload the required information through our website or if you need more help or information about the procedure, just let us know: Tel +34 915 194 392 or info@ustaxconsultants.es


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