Streamlined Foreign Offshore Procedures (SFOP)
Streamlined Foreign Offshore Procedures (SFOP): A Guide to Rectifying Expat Taxes
Are you a U.S. expatriate or an accidental American who has recently discovered the obligation to file U.S. Tax Returns for all those years spent working and living abroad? Don’t fret; we’re here to help you navigate the process of catching up on your U.S. expat taxes without undue stress.
Understanding Streamlined Foreign Offshore Procedures (SFOP)
The IRS has established a unique amnesty program, the Streamlined Foreign Offshore Procedures (SFOP), tailored specifically for expatriates and accidental Americans seeking to become compliant with their U.S. tax obligations and other reporting requirements.
The SFOP is exclusively available to taxpayers who are non-residents of the U.S. and whose non-compliance is deemed non-willful, as further elaborated below. Under this program, eligible individuals are exempt from failure-to-file and failure-to-pay penalties, accuracy-related penalties, information return penalties, or FBAR penalties. Even in the event that your SFOP-filed returns are audited by the IRS, these penalties will not apply, unless the IRS can demonstrate willful non-compliance and FBAR violations.
What’s Required for Streamlined Foreign Offshore Procedures (SFOP) Filing?
- Your most recent three delinquent tax returns
- Under the SFOP, you must file tax returns for the last three years whose due date has not yet passed. If a tax return is not yet due, for instance, for the tax year 2021, it cannot be part of your SFOP submission. In this case, tax returns for the years 2020 to 2018 will comprise your SFOP filing.
- The last six delinquent Form 114 (FBAR)
- In addition to your tax returns, you are also required to file Form 114 Fincen (FBAR) for the last six years. Importantly, even for years when your assets didn’t meet the $10,000 threshold, you must still file Form 114 under the SFOP.
- Submission of Form 14653
- Lastly, you must provide certification that your non-compliance was not willful. This certification is made through Form 14653.
Am I Eligible for Streamlined Foreign Offshore Procedures?
To qualify for this procedure, you must meet two stringent criteria:
Non-Residency Requirement
You must be considered a “foreign resident,” meaning U.S. expats and accidental Americans must adhere to the 330-day rule to meet this criterion:
“Individual U.S. citizens meet the non-residency requirement if they have not been a resident of the U.S. and have been physically present outside the U.S. for at least 330 full days in one or more of the last 3 years for which the due date of the U.S. tax return (or the properly requested extended due date) has passed.”
In essence, this requirement necessitates that you haven’t been a U.S. resident for the past three years and have physically resided outside the U.S. for a minimum of 330 days per year. If filing jointly, both spouses must individually meet this non-residency requirement.
Non-Willful Conduct
To be eligible for SFOP, your conduct must be determined as non-willful. Non-willful conduct comprises negligence, inadvertence, or mistakes, or actions resulting from a genuine misunderstanding of legal requirements.
For instance, if you genuinely did not know you were required to file U.S. tax returns, this can be considered non-willful conduct.
Failure to satisfy both of these conditions renders you ineligible for SFOP filing.
Locations for Streamlined Foreign Offshore Procedures
Downtown Toronto
Toronto Tax Consulting (Head Office)
401 Bay Street Suite 1600
Toronto ON M5H 2Y4
Tel: 416-628-7824 Ext.2
Downtown Toronto (Evening & Weekend)
Toronto Tax Consulting
1 Dundas St W Suite 2500
Toronto ON M5G 1Z3
Tel: 647-951-4852 Ext.2
Downtown Toronto
International Tax Advisor Office
161 Bay St. 27th Floor
Toronto ON M5J 2S1
Tel: 1-800-693-5950
Etobicoke, ON
Etobicoke Tax Consulting
3250 Bloor St W Suite 600 East Tower
Etobicoke ON M8X 2X9
Tel: 1-800-717-4162 Ext.2
North York, ON
North York Tax Consulting
4711 Yonge St 10th Floor
Toronto ON M2N 6K8
Tel: 416-628-7824
Mississauga, ON
Mississauga Tax Consulting
4 Robert Speck Parkway Suite 1500
Mississauga ON L4Z 1S1
Tel: 1-888-905-7577
Oakville, ON
Toronto Tax Consulting
2010 Winston Park Dr Suite 200,
Oakville ON L6H 5R7
Tel: 1-888-905-7577
Markham, ON
Markham Tax Consulting
15 Allstate Parkway Suite 600
Markham ON L3R 5B4
Tel: 416-628-7824
New York, NY
Toronto Tax Consulting
100 Park Avenue #1600
New York NY 10017, United States
Tel: 646-995-5187
Chicago, IL
Toronto Tax Consulting
30 S Wacker Dr #2200
Chicago IL 60606, United States
Tel: 1-800-717-4162
Washington, DC
Toronto Tax Consulting
1200 G St NW Suite 800
Washington, DC 20005, United States
Tel: 1-800-693-5950
Pasadena, CA
Toronto Tax Consulting
Century Square, 155 N Lake Ave Suite 800
Pasadena, CA 91101, United States
Tel: 1-800-693-5950
Miami , FL
Toronto Tax Consulting
201 South Biscayne Boulevard
Miami, FL 33131, United States
Tel: 1-800-693-5950
London, UK
Toronto Tax Consulting
37 Floor, Canary Wharf, 1 Canada Square
London E14 5AA, United Kingdom
Tel: +44 20 3885 6292
Call a U.S. Tax advisor for Streamlined Foreign Offshore Procedures in Toronto today!
It is best to give a U.S. tax advisor a call to discuss your unique situation. We may be able to help. Please call 416-628-7824 and Press Extension 2. If someone does not answer live, U.S. tax advisors are not always available. We do encourage you to leave a message with the best time to call back.