Expat Forum For People Moving Overseas And Living Abroad banner

1 - 4 of 4 Posts

·
Registered
Joined
·
2 Posts
Discussion Starter #1
I am a US citizen and have lived and worked abroad over the past 10 years but spend considerable time in the US each year. In no year do I meet the 330 days out-of-country test and thus not eligible to use the Foreign Streamline procedure. The problem is I also was not filing income tax returns as such I am also not eligible for the Domestic Streamline process either. I dont have any interest in a foreign company or trust but do have about US $50k saved in foreign banks.

Is my only option the Offshore Voluntary Procedure? I really cannot afford the penalties associated with doing that PLUS the unpaid taxes.

Any suggestions would be greatly appreciated.

Sincerely

Jas
 

·
Administrator
Joined
·
48,784 Posts
You say that you don't meet the 330 days out of country test. Where is your primary residence? And have you filed taxes anywhere outside the US during your work abroad? That could provide you with an "excuse" to use the Streamline procedure (i.e. using the bona fide residence test instead of the physical presence test).

Or, you just start filing from where you are now. The IRS has little or no means of knowing about your overseas sourced income and few resources for auditing the filing information. Now, if you've been receiving US based income and not filing, that's a rather different question altogether.
 

·
Registered
Joined
·
2 Posts
Discussion Starter #3
You say that you don't meet the 330 days out of country test. Where is your primary residence? And have you filed taxes anywhere outside the US during your work abroad? That could provide you with an "excuse" to use the Streamline procedure (i.e. using the bona fide residence test instead of the physical presence test).

Or, you just start filing from where you are now. The IRS has little or no means of knowing about your overseas sourced income and few resources for auditing the filing information. Now, if you've been receiving US based income and not filing, that's a rather different question altogether.
Thanks for your insights and suggestions. Starting this year, I am now back working in the US fulltime however the past 10 years i resided and lived abroad and paid taxes there. I do not own a home here or there.

I was not aware that if I met the bonafide test that the 330 days is not required for the Streamline eligibility.

Thanks again Jas
 

·
Registered
Joined
·
752 Posts
According to the IRS FAQ, the reference to IRC § 911 and its regulations is only to the parts of those authorities that define “abode,” which are found in IRC § 911(d)(3) and Treas. Reg. § 1.911-2(b). Non-residency for purposes of the Streamlined Foreign Offshore Procedures is defined in those procedures, and not in IRC § 911 and its regulations.

Therefore this is a case where I believe Bev is wrong (a very rare occurrence).

Assuming you do not have a US abode (and thus meet that requirement) , to meet the non-residency rule, you need to be physically outside the United States for at least 330 full days in any one or more of the most recent three years.

So to the other half of your question...

One possible strategy is to time your streamlined filing at a point in time that you meet that non-residency requirement...

If COVID has cramped your travels in the US this year, you could potentially use 2020 as the non-resident year and defer streamline filing until next year.
Alternatively, if you can, ensure that in 2021 you are out of the country for 330 days and then enter the streamlined program in 2022.

Another strategy is to simply come into quiet compliance by starting to file from now on, although that does not come with the protections of the streamlined program.

It goes without saying that there will be others on this list which would suggest doing nothing, particularly if you have no US situ assets (ie don't come into compliance)
 
1 - 4 of 4 Posts
Top