In exchange for filing three years of tax returns, six years of FBARs, and a certification that your conduct was non-willful, you resolve the back years at a reduced penalty: 5% of your foreign financial assets for taxpayers living in the United States, and zero for many taxpayers living abroad.

The program is powerful, but it rests entirely on that non-willful certification, which you sign under penalty of perjury. This article explains who qualifies and how the procedures work. To assess your options with counsel, call (415) 968-1780.

What the streamlined procedures are

The streamlined procedures let eligible taxpayers correct unreported foreign income and accounts without the full penalty structure that applies outside a program, and without the cost and rigor of the formal voluntary disclosure route. They replaced the more onerous Offshore Voluntary Disclosure Program (OVDP), which required eight years of amended returns and much steeper penalties.

The streamlined path is designed for the large population of taxpayers who simply did not know about their filing obligations, which is common among immigrants, dual citizens, and Americans who inherited or opened accounts abroad.

Two versions: foreign and domestic

There are two tracks, and the difference in cost is significant.

The Streamlined Foreign Offshore Procedures (SFOP) are for taxpayers who meet a non-residency requirement, generally those who lived outside the United States for at least 330 days in one of the relevant years and did not have a U.S. abode. For qualifying taxpayers, the miscellaneous offshore penalty is zero. You pay any back tax and interest, but no offshore penalty.

The Streamlined Domestic Offshore Procedures (SDOP) are for taxpayers who do not meet the non-residency test, typically U.S. residents. Here the miscellaneous offshore penalty is 5% of the highest aggregate year-end value of the foreign financial assets that were unreported or produced unreported income during the covered period. For most domestic taxpayers, a one-time 5% penalty is far better than the alternative.

Who qualifies for the streamlined procedures?

Eligibility comes down to a few core requirements:

• Non-willful conduct. Your failure to report must have resulted from negligence, inadvertence, mistake, or a good-faith misunderstanding of the law. This is the heart of the program.
• Not under examination. You cannot be under IRS civil examination or criminal investigation, regardless of whether it relates to the foreign accounts.
• A valid Taxpayer Identification Number. You need a Social Security number or ITIN.
• The right filings. Domestic taxpayers amend already-filed returns; foreign taxpayers may file delinquent original returns as well as amended returns.

What you actually file

A streamlined submission has three parts: three years of amended (or, for foreign filers, delinquent) income tax returns reporting the previously omitted income; six years of FBARs; and a signed certification of non-willfulness, made on Form 14654 (domestic) or Form 14653 (foreign). Domestic filers also pay the 5% penalty with the submission. The returns must be complete and correct, and the income has to actually be reported, not just the accounts disclosed.

The non-willful certification is the whole ballgame

The certification is not a checkbox. You sign it under penalty of perjury, and you must give a specific, truthful narrative of why you failed to report, describing your conduct and your reasons.

If the IRS later concludes the certification was false, meaning your conduct was actually willful, it can pursue full civil penalties and, in a serious case, refer the matter for criminal prosecution, using your own certification against you. This is why the streamlined program is safe and effective for genuinely non-willful taxpayers and dangerous for anyone whose conduct might be viewed as willful.

Getting an honest, careful read on that question before you certify is the single most important step, and it is a legal judgment, not a form-filling exercise. We compare the paths in Streamlined vs. IRS Voluntary Disclosure: Which Path Fits Your Case.

What the streamlined procedures do not cover

The streamlined path is not for everyone. If your conduct may have been willful, this is the wrong program, and the formal IRS Voluntary Disclosure Practice should be considered instead.

If you have unfiled FBARs but no unreported income, you may not need the streamlined program at all; the Delinquent FBAR Procedures may resolve it with no penalty. And if you have missed only foreign information returns, the delinquent international information return path may fit better. Choosing among these is the point of the consultation.

Is the streamlined program still available?

As of 2026, the streamlined procedures remain open, but the IRS has always reserved the right to change or end them, and it has signaled over the years that the window will not stay open forever. That uncertainty cuts one way: if you are eligible and non-willful, coming forward sooner protects the option. Once the IRS contacts you or opens an examination, the streamlined door generally closes.

How Kugelman Law helps

We guide taxpayers through streamlined submissions from the threshold question forward: assessing willfulness honestly, choosing the right track or an alternative, preparing the certification narrative, and coordinating the returns and FBARs.

For the underlying account rules, see our FBAR filing requirements and FBAR penalties articles and our Streamlined Offshore Procedures service page, and for the full offshore picture our offshore and international tax attorney page.

Our results reflect what disciplined advocacy achieves in high-stakes tax disputes. In one federal matter, two IRS Notices of Deficiency proposing more than $557,000 across six years were settled in U.S. Tax Court down to roughly $38,000, and with avoided interest and California exposure the client effectively saved over $1.2 million. Results depend on specific facts. Past results do not guarantee future outcomes.

Talk to an attorney before you make a streamlined submission

Because the certification is signed under penalty of perjury, the willfulness question should be assessed by an attorney, under privilege, before you file. Schedule a paid, privileged consultation with Kugelman Law by calling (415) 968-1780 or visiting our contact page.

Frequently asked questions

What are the Streamlined Filing Compliance Procedures?

They are an IRS program that lets non-willful taxpayers correct unreported foreign income and accounts by filing three years of tax returns, six years of FBARs, and a certification of non-willfulness. The offshore penalty is 5% for taxpayers living in the U.S. and zero for many living abroad, far less than the penalties that apply outside a program.

What is the difference between the domestic and foreign streamlined procedures?

The Streamlined Foreign Offshore Procedures (for taxpayers who meet a non-residency test) carry a zero offshore penalty. The Streamlined Domestic Offshore Procedures (for U.S. residents) carry a 5% penalty on the highest aggregate year-end value of the unreported foreign financial assets during the covered period.

Who qualifies for the streamlined program?

Taxpayers whose failure to report was non-willful, who are not under IRS examination or criminal investigation, and who have a valid Social Security number or ITIN. Domestic filers amend existing returns; foreign filers may also file delinquent original returns.

What does “non-willful” mean?

Non-willful conduct results from negligence, inadvertence, mistake, or a good-faith misunderstanding of the law, rather than an intentional or reckless disregard of a known duty. You certify your non-willfulness under penalty of perjury, so this determination should be made carefully with an attorney.

Is the streamlined program still open in 2026?

Yes, as of 2026 the procedures remain available, but the IRS can change or end them at any time, and eligibility generally closes once the IRS contacts you or opens an examination. Confirm current program status before filing.

About the author

Alex Kugelman is the founder and managing attorney of Kugelman Law, with nearly two decades of federal tax controversy experience including U.S. Tax Court and U.S. District Court litigation. He is admitted in California and before the U.S. Supreme Court, the U.S. Tax Court, and the U.S. District Court for the Northern and Eastern Districts of California, and served as San Francisco Chair of the Federal Bar Association Tax Division in 2018. He is nationally recognized for cryptocurrency tax and has been quoted in the Financial Times and the New York Post on California tax enforcement. For matters that reach into IRS offshore examinations, his colleague Otto Bosch, a former IRS Revenue Agent from the Large Business & International division, leads the firm’s federal audit-defense work.

This article is attorney advertising and general information, not legal advice, and it describes an IRS program whose terms and availability can change. Offshore disclosure is fact-specific and the non-willful determination is a legal judgment. Contacting Kugelman Law does not create an attorney-client relationship.