# FBAR penalty



## jeremyisthere (Jul 26, 2021)

US/UK dual citizen living in Amsterdam for 4 years now, never filed taxes, never filed FBAR but I was always over the 10k limit. Have an account in the UK and one here in Amsterdam, both opened with my UK passport. I never knew of the tax ruling and now I read everywhere I am facing a 10k penalty or more?! Should I disclose it or is it okay to just leave it be and not do anything unless I get contacted, if ever? Is the 10k penalty for real or just some hoax to put fear in citizens to disclose


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## Nononymous (Jul 12, 2011)

The $10k fine is real but rarely if ever enforced.

If you want to come into compliance on tax and FBAR, use the offshore streamlined program, as it waives penalties for anyone who wasn't aware of their filing requirements. There is also a separate procedure for filing delinquent FBARs that waives penalties.

If you have no US assets or interest in moving to the US, you can also continue to ignore all this. If you have a non-US birthplace on your UK passport, don't disclose your US citizenship to any banks and you will not be subject to FATCA reporting. If you can avoid FATCA there is zero risk of your ever being discovered or contacted. Generally speaking the IRS has no ability to punish anyone in other countries, but if you are living in the Netherlands and are not a Dutch citizen, they could in theory ask the national authorities for collection assistance under tax treaty provisions (this is possible in only five countries; the other four being Canada, Denmark, France and Sweden).


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## Bevdeforges (Nov 16, 2007)

The 10K fine is real, but as Nononymous has said, is more or less irrelevant unless you give the IRS some incentive to review your tax status. (Mainly if you flaunt your enormous wealth and your citizenship for some reason and it happens to come to the attention of the IRS.)


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## jeremyisthere (Jul 26, 2021)

Thanks guys. Well unfortunately I don't have enormous wealth to flaunt, however if for some stupid reason I do get a notice from the IRS about my foreign accounts, would I be hit with a 10k or more penalty at that point or would I still be able to disclose everything in response to their notice and explain I didn't know about it and they'd be okay with it. I see the whole fbar-fatca thing as more of a forced information exchange rather than anything else but I could be wrong. In response to Nononymous, in the event that in 10 years down the line I'd move back to the US I should be able to still streamline everything penalty-free including tax returns (in which I would normally never owe anything because of the foreign income exclusion) and be cool with the IRS to continue a life in the US or what is your take on that


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## Nononymous (Jul 12, 2011)

If the IRS finds you and hits you with a fine - very unlikely - then all amnesty deals are off the table.

Were you born in the US? If so, even a UK passport won't help you dodge FATCA, if the bank employees are awake and checking place of birth when you open an account.

Your plan to ignore it all now and do streamlined if you decide to move to the US does rest on the assumption that the streamlined program will still be around in the future. There's no guarantee of that, though if it's any comfort over the past ten years we've seen the pseudo-amnesty programs get better, not go away.

PS This coterminous thread about flying under the radar in Germany will answer a lot of your questions as well. The one caveat being that Germany does not have a collection-assistance agreement in the way that the Netherlands does, which allows the national authorities to assist the IRS in collecting from a US person who is not also a citizen of the country. In Germany you would have more protection as a non-national.


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## jeremyisthere (Jul 26, 2021)

Born in the UK. If the IRS finds me they hit me with a penality, that's harsh though - I'd still be a citizen that did not know about the fbar ruling, they should still let me streamline it at that point.


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## Nononymous (Jul 12, 2011)

jeremyisthere said:


> Born in the UK. If the IRS finds me they hit me with a penality, that's harsh though - I'd still be a citizen that did not know about the fbar ruling, they should still let me streamline it at that point.


If you are born in the UK, you can hide forever. (Currently your Dutch bank does not know that you are a US citizen. Keep it that way - if they find out, they'll demand that you provide an SSN and possibly restrict services available to you.)

You may not like it, but the amnesty programs are designed to encourage people to come forward, not for people they find first. But if you don't tell financial institutions about your US citizenship, you will never been found because you will never be subject to FATCA reporting. 

Minor point of consolation: in Canada, which has the same sort of treaty arrangement than the Netherlands, the national authorities will assist in collection of tax penalties, but not FBAR penalties, because FBAR is not covered by the tax treaty - strictly speaking it has nothing to do with taxation. So FBAR fines might not be collectible in the Netherlands, even if you are not a citizen there.


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