Americans living abroad who want to renounce their U.S. citizenship often discover they first need to become tax compliant. For eligible taxpayers, the Streamlined Filing Compliance Procedures provide the most efficient path to completing those filings while qualifying for IRS penalty relief.
The SFOP require three years of tax returns and six years of FBARs to become compliant with your U.S. tax filing obligations, while the expatriation rules require five years of tax compliance. The additional two years of tax returns are simply filed alongside the Streamlined submission, satisfying both sets of requirements.
years of tax returns under Streamlined
additional delinquent tax returns
years of tax compliance for Form 8854
Plus six years of FBARs, filed as part of the Streamlined submission.
Most taxpayers complete their compliance filings before scheduling their embassy appointment to ensure the five-year filing requirement has already been satisfied.
Why Streamlined Matters Before You Renounce
Before you renounce, Form 8854 asks you to certify that you met all your U.S. tax obligations for the five tax years before the year you expatriate. For most Americans abroad who are behind, that means filing five years of tax returns and six years of FBARs. All the routes and steps are explained in How to Become Tax Compliant Before Renouncing U.S. Citizenship.
What Are the Streamlined Filing Compliance Procedures?
The Streamlined Filing Compliance Procedures are an IRS amnesty program designed for Americans living abroad who failed to file U.S. tax returns or FBARs because their non-compliance was non-willful.
The program allows eligible taxpayers to become tax compliant while avoiding the failure-to-file and failure-to-pay penalties that would otherwise apply. For Americans abroad who recently discovered their U.S. filing obligations, it is the most common and effective path back into compliance.
- Three years of delinquent U.S. tax returns.
- Six years of FBARs (FinCEN Form 114).
- Form 14653, certifying that the previous non-compliance was non-willful.
For taxpayers planning to renounce U.S. citizenship, the Streamlined Filing Compliance Procedures provide the foundation for becoming tax compliant before expatriation. The only additional requirement is filing the two extra years of tax returns needed to complete the five years of tax compliance required under the expatriation rules.
Why the Streamlined Procedures Alone Are Not Enough Before Renouncing
The Streamlined Filing Compliance Procedures and the expatriation rules serve different purposes. The Streamlined Procedures determine how many tax returns and FBARs must be submitted to qualify for the IRS amnesty program. The expatriation rules determine whether a taxpayer can certify five years of tax compliance on Form 8854 after renouncing U.S. citizenship.
As a result, the filing requirements differ. A taxpayer who intends to renounce U.S. citizenship simply files:
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Three years of tax returns under the Streamlined Procedures.
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Two additional delinquent tax returns.
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Six years of FBARs.
This approach satisfies both sets of requirements. The taxpayer qualifies for Streamlined penalty relief while simultaneously completing the five years of tax filings required to certify compliance on Form 8854 after expatriation.
What If the Streamlined Filing Compliance Procedures Are Not Available?
Streamlined requires non-willful conduct
The Streamlined Filing Compliance Procedures are available only when the previous failure to file was non-willful.
Taxpayers who do not qualify for Streamlined still have a path to becoming compliant before renouncing U.S. citizenship.
In these cases, the required tax returns and any delinquent FBARs are prepared and filed outside the Streamlined Procedures using an alternative compliance approach appropriate for the taxpayer’s circumstances. The exact filings required depend on the taxpayer’s prior filing history.
Our Pre-Renunciation Tax Compliance Package
Preparing five years of tax returns, six years of FBARs, and determining whether Streamlined applies can be overwhelming. Our Pre-Renunciation Tax Compliance Package is designed specifically for Americans abroad who need to complete this process before renouncing.
The package includes:
- Five years of required U.S. tax returns.
- Six years of FBARs, if required.
- Form 14653 for taxpayers who qualify for the Streamlined Filing Compliance Procedures.
- An equivalent compliance submission for taxpayers who do not qualify for Streamlined.
- Guidance throughout the compliance and renunciation process.
The package focuses exclusively on the filings required before renunciation.
The Final U.S. tax return and Form 8854 are filed after the calendar year of expatriation and are therefore not included in the Pre-Renunciation Tax Compliance Package.
Examples
Taxpayer eligible for Streamlined
Emma moved to Spain in 2016 and never realized she remained subject to U.S. tax filing requirements.
Her failure to file was non-willful, making her eligible for the Streamlined Filing Compliance Procedures.
Before renouncing, she files:
- Three years of tax returns through the Streamlined Procedures.
- Two additional delinquent tax returns.
- Six years of FBARs.
- Form 14653.
These filings complete the five years of tax compliance required under the expatriation rules. After renouncing, Emma files her final U.S. tax return and Form 8854 for the year of expatriation.
Taxpayer not eligible for Streamlined
Michael knew about his U.S. filing obligations but chose not to file. Because his failure to file was not non-willful, he does not qualify for the Streamlined Filing Compliance Procedures.
Instead, he files five years of required tax returns and any delinquent FBARs for the applicable years using an alternative compliance approach.
This way, Michael still completes the filings required to certify five years of tax compliance on Form 8854 after expatriation.
Becoming tax compliant before renouncing is often much simpler than many Americans abroad expect. Completing the required filings before expatriation reduces the risk of covered expatriate status and provides a clear path toward ending future U.S. tax obligations.
For more information about the renunciation process, including embassy appointments, costs, timelines, and tax requirements, see our Renouncing U.S. Citizenship FAQ.
Book your 20-minute tax consultation
Not sure whether you qualify for Streamlined, or which route fits you? Speak with one of our Enrolled Agents. We work exclusively with Americans living abroad and will recommend the most appropriate compliance path for your circumstances.
$50 consultation fee, fully deducted from your tax preparation fee if you become a client.
