Streamlined Foreign Offshore Procedures (SFOP): complete 2025 guide
The Internal Revenue Service (IRS) introduced the Streamlined Foreign Offshore Procedures to give Americans abroad a fair way to catch up on missed tax filings without facing crushing fines. Instead of penalties, eligible taxpayers can come forward, submit the required filings, and settle only the tax and interest due.
This guide walks you through who qualifies for SFOP, what forms to file, and how to make the process work smoothly in 2025.
This article is brought to you by Taxes for Expats – a top-rated team helping Americans abroad meet US filing requirements. If you need to catch up through SFOP or are unsure whether the procedures apply to your situation, we can guide you every step of the way. Learn about our services or contact us.
What are IRS Streamlined Foreign Offshore Procedures (SFOP)?
Streamlined Foreign Offshore Procedures is the IRS program that allows eligible expats to fix past filing gaps in a formal, efficient way. The goal is to restore compliance while waiving penalties for failure to file, accuracy issues, information returns, and FBARs in qualified cases. It applies to US taxpayers living abroad who had unreported income or foreign assets, and who can certify non-willful conduct, file three years of returns plus six years of FBARs, and pay any tax with interest.
Below, SFOP is set against other IRS options – from the Voluntary Disclosure Practice to delinquent filing routes – so you can see how this Amnesty Program compares and where a simple disclosure won’t suffice.
| Different IRS programs | Core filings & 2025 notes | Civil penalty & Criminal protection |
|---|---|---|
|
SFOP For non-willful expats meeting non-residency rules |
3 years of returns, 6 years FBARs; paper filing only; IRS FAQ refreshed Jul 2025 | No failure-to-file, accuracy, info-return, or FBAR penalties; tax + interest only Not a criminal-resolution track |
|
SDOP For non-willful taxpayers living in the US |
3 years amended returns, 6 years FBARs; don’t forget the IRS page reviewed Jul 2025 | 5% Title 26 miscellaneous offshore penalty on highest aggregate assets. Not a criminal-resolution track |
|
Voluntary Disclosure (VDP) For willful or high-risk cases |
Multi-year amended returns; Form 14457 revised Jul 2025 | Typical civil fraud penalty 75% (one year) plus a willful FBAR penalty up to greater of $100,000 or 50% per violation. Can mitigate criminal exposure if accepted |
|
Delinquent FBAR For tax already reported, but FBARs missed |
Late FBARs; IRS page updated Feb 2025 | No FBAR penalty if criteria met and no prior IRS contact. |
|
Delinquent Info Returns For missed forms like 3520 or 8938 with reasonable cause |
File delinquent forms + explanation; IRS page updated Nov 2024 | Penalties may be assessed during processing even with reasonable-cause statements. |
|
Traditional Amnesty For older OVDP users (program closed 2018) |
Required full 8 years of filings | High penalties, often 27.5%–50% Criminal protection, if accepted |
Who qualifies to use the SFOP?
To use the IRS amnesty program for delinquent offshore filers, you must meet narrow, fact-specific criteria. These rules determine if you can access the Streamlined Foreign Offshore Procedures, and the sections below outline the standards and exclusions.
Non-willfulness requirement
Your past noncompliance must be non-willful – due to negligence, inadvertence, mistake, or a good-faith misunderstanding. You must certify this on Form 14653 under penalty of perjury.
Non-residency rule
SFOP applies only if you meet a specific non-residency test. For joint filers, both spouses must meet it, and the amnesty program benefits apply only when the test is satisfied.
- 330-day test: For citizens and green card holders, in any one of the most recent three years with a passed due date, you had no US abode. You also spent at least 330 full days outside the United States.
- Substantial presence test: For non-citizens who are not green card holders, apply the statutory day-count test. You qualify if, in any one of those three years, you did not meet the substantial presence test under IRC 7701(b)(3).
Who cannot use SFOP
You are ineligible for SFOP if the IRS has begun a civil examination for any year or if you are under criminal investigation.
Additionally, cases with potential fraud or willfulness belong in the voluntary disclosure practice, and any prior penalties already assessed are not abated by SFOP.
4 key items to note when filing Streamlined Foreign Offshore Procedures
Below is the concise filing checklist for the streamlined foreign offshore procedures, teeing up later sections on eligibility, strategy, and mailing.
- 3 years of tax returns (Form 1040): File original or amended returns for the latest three years – write “Streamlined Foreign Offshore” in red at the top – and pay any tax plus interest.
- 6 years of FBARs (FinCEN Form 114): E-file six years of FBARs via FinCEN’s BSA system, select “Other” as the late-filing reason, and enter “Streamlined Filing Compliance Procedures.”
- Non-willfulness certification (Form 14653): Sign the certification, submit the original, and attach copies to each return and information return as directed.
- Other International information returns (if applicable): Include required FATCA/foreign forms (e.g., 8938, 3520/3520-A, 5471, 8865, 8858, 8621) with your returns to complete your disclosure package.
Apply for SFOP using these 9 steps
Complying with the IRS streamlined foreign offshore procedures is straightforward when you follow a precise plan. The five steps below take you from tax returns through FBARs, certification, assembly, and mailing.
Step 1: Prepare 3 years of original or amended federal returns on Form 1040 or 1040-X. Review each year carefully so the income, deductions, and credits align with your actual records and foreign income documents.
Step 2: Attach every international form that applies to your situation. This may include Form 8938 for foreign assets, Form 3520 for a gift from parents abroad, or Form 5471 if you own a foreign company.
Step 3: Write Streamlined Foreign Offshore in red at the top of each return. At the same time, calculate the total tax and statutory interest owed and prepare a check for the exact amount, for example, if you missed reporting foreign dividends in 2022.
Step 4: File 6 years of FBARs online through the FinCEN BSA E-Filing system. Report all accounts where you had either a financial interest or signature authority, even if the balance only briefly went over $10,000, such as a pension plan or joint family account.
Step 5: When prompted, select Other as the late-filing reason. In the explanation box, type Streamlined Filing Compliance Procedures, then download and save the confirmation receipts for each year.
Step 6: Complete and sign Form 14653 (Certification Statement) using the March 2025 revision. In this form, give a clear explanation of why your non-compliance was non-willful, for example misunderstanding that a local ISA or SIPP had to be reported to the IRS.
Step 7: Place the original signed certification in your submission package. Also, attach copies to each tax return and international form, but remember not to include them with the FBARs.
Step 8: Assemble the full paper package by organizing the tax returns, international forms, and Form 14653 together with your payment check. Review everything carefully for accuracy, making sure names match passports and Social Security records, and that all balances and form details are correct.
Step 9: Mail the complete SFOP submission to: Internal Revenue Service, 3651 South I-H 35, Stop 6063 AUSC, Attn: Streamlined Foreign Offshore, Austin, TX 78741. Use a tracked courier service such as FedEx or DHL to confirm delivery, and keep the courier proof along with your FBAR confirmation receipts in case the IRS later requests verification.
NOTE! If you held shares in a foreign corporation subject to the section 965 transition tax, include returns for 20172018 so the package is complete. And if you discover an error after filing, send an amended streamlined submission with Amended written in red on Form 14653 and the corrected returns.
When is professional help for the IRS SFOP needed
This section previews the decision points you’ll face, from Form 14653 to foreign account reporting and FBAR late filing, so you can judge when to bring in a pro.
When the IRS sets strict rules, knowing when to seek help can be the difference between smooth approval and lasting penalties.
- Complex foreign reporting like Forms 3520, 5471, 8938, or 8621 makes professional input almost essential.
- A strong Form 14653 non-willful narrative protects you under penalty of perjury.
- Cases touching section 965 or high foreign balances carry extra risk without guidance.
- Non-willful FBAR penalties are capped at $16,536 per report (per form), not per account, for penalties assessed in 2025.
Filing on your own may seem straightforward, but one misstep in calculating tax or drafting Form 14653 can trigger an audit, and the IRS notes streamlined submissions remain open to examination. Errors in FBAR filings or missed information returns expose you to penalties that guidance under Streamlined Filing Compliance Procedures is designed to prevent.
NOTE! Professional advisors make sure your facts align with the non-willful standard and confirm if SFOP is the right choice. They also create a clear record that ties together your returns, FBARs, and supporting evidence.
This reduces the risk of FBAR late filing penalties, keeps IRS interest from snowballing, and gives you a file that can stand up to review.
OBBBA 2025 and its impact on Streamlined Foreign Offshore Procedures
The One, Big Beautiful Bill Act (Pub. L. 119-21), signed July 4, 2025, reshapes several domestic and international tax rules for 2025 and beyond. It does not change the Streamlined Foreign Offshore Procedures, but it can change the amounts calculated inside your three-year SFOP filings.
- Program mechanics – eligibility, Form 14653, and six years of foreign account reporting – remain unchanged under current IRS streamlined guidance.
- International changes (e.g., GILTI, FDII, CFC rules) may alter 2025 computations for filers with foreign corporations, affecting numbers that flow into Forms 5471/8992.
FBAR is separate from OBBBA – the April 15 due date with an automatic extension to Oct 15 still applies and is unaffected.
NOTE! Most international changes take effect for tax years beginning after Dec 31, 2025.
Our experts can help you navigate SFOP with confidence
Filing through the Streamlined Foreign Offshore Procedures can be life-changing – but only if done right. Between proving non-willfulness, filing six years of FBARs, and preparing complex international returns, the details matter.
Taxes for Expats gives Americans abroad access to trusted, year-round support – so you can meet IRS compliance requirements without the guesswork.
