Last Updated on August 26, 2025 by Rashad Bolbol

Behind on Your US Taxes While Living Abroad? Here’s the Good News

Living overseas doesn’t mean you can forget about U.S. taxes. As a U.S. citizen, you’re still required to file annual tax returns and report your worldwide income — even if you haven’t set foot in the country for years. This surprises many expats, since most countries tax based on residency rather than citizenship.

The encouraging part? The IRS offers a program designed to help Americans abroad catch up on their filings without the crushing penalties that usually come with late returns. It’s called the Streamlined Filing Compliance Procedures.

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What Exactly Is the Streamlined Program?

The Streamlined Filing Compliance Procedures were created by the IRS as a type of tax amnesty. They’re aimed at taxpayers who failed to file not because they were hiding income, but because they didn’t know the rules, misunderstood their obligations, or simply made an honest mistake.

To use the program, you’ll need to:

• File three years of back tax returns (with all required forms)

• File six years of FBARs (Foreign Bank Account Reports)

• Submit a signed statement confirming that your oversight was not intentional

• Pay any tax and interest owed — with no late-filing penalties if you qualify

More details are available directly on the IRS website here.

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Who Can Use the Streamlined Filing Compliance Procedures?

This program is available to expats who:

• Have lived abroad long enough to meet the IRS’s foreign residency test

• Can truthfully certify that their non-compliance wasn’t willful

• Haven’t already been contacted by the IRS about missing returns

• Hold a valid SSN or ITIN

It’s not just for people who never filed at all. If you submitted past returns but left out required forms — like those for foreign accounts or business ownership — the streamlined program can help you correct those gaps too.

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Why It Matters

Without streamlined filing, catching up can be stressful and very expensive. The IRS imposes steep penalties for missing returns or FBARs — in fact, FBAR penalties alone can be $10,000 per account, per year.

The Streamlined Filing Compliance Procedures remove those penalties for eligible taxpayers. You’ll only need to pay the actual tax and interest due, and once your filing is accepted, you’ll be back in compliance with the IRS.

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A Note for Business Owners

If you own a foreign company, partnership, or trust, additional reporting may be required. These extra forms are critical to make sure your streamlined submission is valid and that your penalty relief isn’t jeopardized.

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Why Work With a Professional

On the surface, the program looks straightforward, but the reality can be much more complicated. Multiple income sources, foreign investments, and business interests often mean more forms — and more room for error. A missed document or incorrect filing could cause delays or even disqualify you from relief.

That’s why many expats choose to work with tax professionals who understand both U.S. and international reporting rules. It’s often the safest way to ensure everything is done correctly the first time.

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The Bottom Line

The Streamlined Filing Compliance Procedures offer expats a valuable second chance to catch up on U.S. tax obligations without being buried in penalties. By filing the required returns and reports, you can clean up past mistakes and move forward with confidence.

But timing is key — once the IRS contacts you about unfiled returns, this option is no longer available. If you think you qualify, it’s better to act sooner rather than later.

If you’d like to learn more about the basics of filing as an expat, visit our page on U.S. tax filing for expats.