Delinquent FBAR Submission: How to Get Back on Track
Did you miss your FBAR filing? You’re not alone. Thousands of expats face the same issue each year. The good news? You can fix it and avoid penalties if you act quickly.
Whether you didn’t know you had to file or just let it slip, the IRS offers ways to get compliant without breaking the bank. In this guide, we’ll walk you through the Delinquent FBAR Submission Procedures, explain how to dodge those hefty IRS fines and highlight your best filing options for 2025.
Let’s get you back on track — no stress, no penalties, just clear steps forward!
What Is FBAR and Why Is It Important?
The Foreign Bank Account Report (FBAR) is a form that US expats must file if they own one or more foreign financial accounts totaling over $10,000 combined at any point during the year. Those financial accounts are often banks, but they can also include other financial assets, such as brokerage accounts or retirement accounts.
Filing an FBAR doesn’t mean paying new taxes. It just lets the Treasury Department know about your foreign financial accounts. This requirement was put in place to help curb tax evasion and money laundering, and failing to file can lead to serious penalties.
What Happens If You Miss the FBAR Deadline?
If you miss the deadline for filing an FBAR, the penalties will depend on whether your failure was intentional.
- The fine for non-willful violations is currently about $12,500 per year and tends to increase every year.
- The fines for willful violations (refusing to file on purpose) can reach $100,000 per account per year or 50% of the account balance, whichever is greater. Willful violators may even face criminal charges, though this is rare.
The statute of limitations is six years from the filing deadline. Anything before that is off-limits. But within those six years, anything is fair game.
The good news is that if your failure to file was accidental, you can dodge the full penalties through the Delinquent FBAR Submission Procedures.
How to Use Delinquent FBAR Submission Procedures
To use the Delinquent FBAR Submission Procedures, you will have to file your missing forms and self-certify that your failure to file was accidental.
Who Qualifies?
You can qualify for the Delinquent FBAR Submission Procedures if all the following are true:
- You haven’t been contacted by the IRS for an audit or delinquent returns
- You’ve properly reported all foreign income on your US tax returns and paid any taxes due
- Your failure to file wasn’t willful (e.g., you didn’t know about FBAR or got poor advice)
How to Submit Past-Due FBARs:
- File All Missing FBARs: Gather records for every year you missed (up to 6 years back). Then, file FinCEN Form 114 to report your foreign accounts for each missing year.
- Write an Explanation: Include a clear statement with your filing, such as “I was unaware of the FBAR requirement while living abroad” or “My accountant didn’t advise me to file.” Keep it honest and concise.
- Submit Electronically: Have your FBARs filed via the BSA E-Filing System. This form cannot be mailed in; they must be electronically filed.
What Happens Next?
If your submission is approved, the IRS will waive all penalties, assuming your tax returns match the reported accounts. That means no audit and no fines. If you’ve got unreported income or other issues, you may face more challenges. (See the alternatives below.)
Alternative IRS Programs for Delinquent FBARs
Don’t qualify for the Delinquent FBAR Submission Procedures? Here are some options to consider.
Streamlined Filing Compliance Procedures
- How It Works: File three years of amended and/or late tax returns and six years of FBARs, plus a certification that your failure to file was non-willful.
- Best For: Expats who unintentionally failed to report their foreign income or FBARs.
- Penalties: If non-willful, none. US residents pay a 5% penalty on unreported account balances; non-residents (abroad 330+ days/year) pay nothing
Voluntary Disclosure Program (VDP)
- How It Works: Filing six years of tax returns and FBARs, plus playing any back taxes and interest.
- Best For: Those at risk of criminal liability for willful violations (e.g., hiding accounts).
- Penalties: Higher (typically 75% of the highest account balance over 6 years), but it shields you from criminal prosecution.
Quiet Disclosure (Not Recommended)
- How It Works: This means quietly submitting past FBARs outside an official program. However, this will not shield you from penalties or prosecution and could trigger an audit. Experts advise against it due to heightened enforcement risks.
- Best For: No one — this approach is not sanctioned by the IRS and is risky.
- Penalties: Filing late without program protection may lead to audits, full non-willful ($10,000 per year) or willful ($100,000+) penalties, and no penalty waiver.
Dreading the last minute scramble pulling together your tax documents? Despair no more! This simple checklist lists the documents you need to have on hand when preparing to file.
Frequently Asked Questions
What If I Missed FBAR Filings From 5+ Years Ago?
The IRS may examine records from up to six years ago. To avoid accruing penalties, submit ASAP via the Delinquent FBAR Submission or Streamlined Procedures.
What If I Owe Back Taxes and Have Delinquent FBARs?
You’ll likely need the Streamlined Filing Compliance Procedures instead, which covers both tax returns and FBARs. The Delinquent FBAR option only works if your taxes are already squared away.
Filing FBAR Late Doesn’t Have to Be Complicated
We hope this guide has helped you understand how to avoid the penalties for filing an FBAR late! Our expat-expert CPAs and IRS Enrolled Agents have ample experience helping US expats get caught up on delinquent taxes using the various programs and procedures available through the IRS.
If you’re ready to be matched with a Greenback accountant, click the get started button below. For general questions on expat taxes or working with Greenback, contact our Customer Champions.
