Recently, the IRS updated its Frequently Asked Questions and Answers page for the Streamlined Procedures to include a new section on amending Streamlined submissions. Since the inception of the Streamlined amnesty program, there has been some uncertainty as to how taxpayers should proceed if they realize, after the fact, that they have made a mistake on a Streamlined submission.

This new guidance is a welcome development for U.S. expats as it both shows a recognition by the IRS that taxpayers living abroad may be prone to mistakes in their Streamlined submissions, which often include complex international tax items, and it delineates specific procedures for cleaning up and refiling the submission without negative repercussions. Like a regular return, amendments to a Streamlined submission must be made prior to an IRS examination of the submitted forms.

The Streamlined Procedures

In recent years, the IRS has made it clear to taxpayers that it is more interested in disclosure than in punishing late filers or non-filers. In 2014, the IRS expanded its more lenient program, the Streamlined Procedures, allowing taxpayers to participate if they can explain in a written statement how their delinquency was not intentional. This lenient approach has allowed tens of thousands of delinquent taxpayers to successfully enter its amnesty programs.

Under the Streamlined Procedures, non-willfully delinquent taxpayers can catch up on their taxes potentially without incurring any penalties. Participants are required to file only 3 years of tax returns and 6 years of FBARs.

Amending a Streamlined Submission

On its amended FAQ page, the IRS states that in order to amend a Streamlined submission, a taxpayer can do the following:

Correct the error by providing the IRS with an amended return, FBAR, or Form 14653 (the Streamlined certification form), depending on where the error lies.

On the top of the certification form, write “amended” in red ink, and on the top of the first page of each corrected amended tax return write “Amended Streamlined Foreign Offshore” in red ink. If the taxpayer made a mistake in filing FBARs with FinCEN, he or she must efile amended FBARs with FinCEN.

Explain all facts and circumstances concerning the error in the original Streamlined submission.

While not clearly stated, it should be presumed that if extra tax is found to be owed due to the submission error, an additional payment to the IRS should be included in the amended submission.

If you are an expat considering the Streamlined Procedures, then it is critically important that you understand the requirements and relief available under your specific circumstances.