Relief Procedures for Certain Former Citizens

What is the “Relief Procedures for Certain Former Citizens”?

The IRS announced a new voluntary disclosure on 6 September 2019.

This amnesty program exists alongside the existing Streamlined Procedure whereby the Streamlined Procedure is aimed at US persons who wish to get into compliance with their US income tax American and doesn’t want to give up their US nationality at the moment.

The IRS announced procedures for certain persons who have relinquished, or intend to relinquish, their United States (U.S.) citizenship and who wish to come into compliance with their U.S. income tax and reporting obligations and avoid being taxed as a “covered expatriate”

Who is this new procedure for?

Relief Procedures for Certain Former Citizens is for:

• US Persons who have relinquished their US citizenship and not became into compliance with their US tax and reporting obligations.
• US Persons who intend to relinquish their US citizenship and wish to become into compliance with their US tax and reporting obligations.

Relief

• If you do not have an SSN you may still make a submission under these procedures.
• If these individuals meet the requirements of these procedures, they will not be liable for any unpaid taxes and penalties for these years or any previous years.

What do I have to do?

• You have to file tax returns for five prior years and the taxable year of expatriation.
• You have to file your FBAR’s .
• You have to relinquish your US citizenship

Some requirements for Relief Procedures for Certain Former Citizens

• You have an average annual net income tax liability of the five years preceding the year of expatriation that is below a specified amount adjusted for inflation (for example, $161,000 for 2016, $162,000 for 2017, $165,000 for 2018, and $168,000 for 2019) (“average income tax liability test”).
• You have a net worth less than $2 million at the expatriation date
• You never filed a tax return before

Need more information on Relief Procedures for Certain Former Citizens?

We, the founders of Americans Overseas, were born in the Netherlands and obtained our American nationality through our (American) mother.

When we heard about the US tax system for the first time around 2013, we were in total disbelief (it can’t be true!), anger (how can they do this?), fear (am I going to get fines or pick up other problems?), and panic (what should I do?). It is (unfortunately) true that there is an additional American tax levy. But there’s no information from local government, and when approached, the consulate referred us to the IRS, and the IRS was impenetrable.

That’s why we started this initiative to help people from all over the world by providing proper information about the US tax system to avoid unnecessary panic, and offering help free of obligation and free of charge. If needed, we have a network of affordable professionals (accountants) who can help you with your tax obligations.

If you have more questions about Relief Procedures for Certain Former Citizens you can contact us at Americans Overseas.

Contact us for more information

Source: IRS