Foreign Real Estate and Offshore Disclosure Landmines
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The IRS offers several programs for taxpayers who need to correct FBAR filing issues. Which option is right for you depends on whether your non-compliance was willful, whether you reported all foreign income on your tax returns, and your overall tax situation.
Streamlined Filing Compliance Procedures: The most common path for Detroit residents with non-willful FBAR violations. The Streamlined Domestic Offshore program is for U.S. residents who failed to report foreign financial assets, while the Streamlined Foreign Offshore program serves qualifying non-residents. Both programs offer reduced penalties compared to standard IRS enforcement.
Delinquent FBAR Submission Procedures: If you properly reported all income from your foreign accounts on your tax returns but simply missed the FBAR filing requirement, you may qualify for delinquent submission with no penalties. This procedure requires a statement explaining why your FBARs are late.
Reasonable Cause Relief: The IRS may waive FBAR penalties if you can demonstrate reasonable cause for your failure to file. Common grounds include reliance on incorrect professional advice, serious illness, or circumstances beyond your control. We help you document and present your case effectively.
Voluntary Disclosure Program: For situations involving willful non-compliance or potential criminal exposure, voluntary disclosure allows you to come forward before the IRS discovers your accounts. This program involves higher penalties but provides protection against criminal prosecution.
We evaluate your specific circumstances and recommend the compliance path that best protects your interests while achieving full IRS compliance.
We begin by reviewing your foreign bank accounts, investment accounts, tax returns, and filing history to determine your compliance status and potential penalty exposure. We identify which years require FBAR filings, whether you have signature authority issues over business or family accounts, and what IRS compliance programs may be available to you.
Based on your unique situation, we develop a customized compliance strategy. We determine whether streamlined filing, delinquent FBAR submission, reasonable cause relief, or voluntary disclosure is most appropriate for your circumstances. We explain the likely timeline, costs, and outcomes for each option so you can make an informed decision.
We prepare and file all required FBARs through the BSA E-Filing System, along with any amended tax returns or disclosure statements. We handle all communications with the IRS and FinCEN on your behalf, respond to any IRS inquiries, and negotiate penalty reductions when applicable.
Once your compliance issues are resolved, we ensure you understand your ongoing FBAR filing requirements. We can also assist with annual FBAR filings and coordinate with your tax preparer to ensure your foreign accounts are properly reported on future tax returns.
Contact our Detroit FBAR attorneys at (248) 262-3400 for a free case review. We'll assess your foreign account reporting obligations, explain your compliance options, and help you resolve any outstanding issues.
