IRS Removes Delinquent FBAR Submission Procedures: What Should Taxpayers Do Next?
On July 1, 2026, the Internal Revenue Service (“IRS”) quietly removed its public webpage describing the Delinquent FBAR Submission Procedures, without explanation. The removal has created significant uncertainty for taxpayers who may have qualified for a penalty-free means of correcting inadvertent FBAR filing omissions. Whether the webpage was removed intentionally or inadvertently, taxpayers can no longer rely on published IRS guidance expressly confirming penalty relief for qualifying delinquent FBAR submissions.
The FBAR, FinCEN Form 114, must generally be filed annually by a U.S. person with a financial interest in or signature authority over foreign financial accounts if the value of those accounts (in the aggregate) exceeds $10,000 at any time during the calendar year. A reportable foreign financial account includes foreign checking and savings accounts, brokerage accounts, mutual funds, certain foreign pension and retirement accounts, insurance policies with cash surrender value, and annuity policies with cash value. Any reportable income from those foreign accounts and assets is specifically included on the taxpayer’s income tax return as U.S. persons are required to report worldwide income.
The FBAR is filed electronically through FinCEN’s BSA E-Filing system. The FBAR filing deadline is April 15, with an automatic extension to October 15. FBAR penalties remain among the most severe information-return penalties under the Internal Revenue Code and Bank Secrecy Act. The penalties for failing to file the FBAR for a taxable year can be severe depending on whether the failure to file was non-willful or willful. In some cases criminal exposure may also apply. Non-willful civil violations may result in civil penalties of up to $10,000 (as adjusted for inflation) per FBAR report. Willful civil violations, however, can trigger penalties equal to the greater of $100,000 (as adjusted for inflation) or 50% of the account balances.
Under the Delinquent FBAR Submission Procedures, taxpayers could file delinquent FBARs without establishing reasonable cause if they had timely filed their federal income tax returns, properly reported all income from their foreign accounts—including foreign dividends and interest on Schedule B—and were not under an IRS civil examination or criminal investigation. The procedures also applied when the unreported foreign accounts generated no reportable income, such as non-interest-bearing accounts, or when the taxpayer had only signature authority and no beneficial interest in the account. For qualifying taxpayers, the procedures provided a penalty-free means of bringing delinquent FBAR filings into compliance.
Without the Delinquent FBAR Submission Procedures, what are taxpayers with delinquent FBARs supposed to do?
Taxpayers may still consider filing delinquent FBARs in a manner consistent with the former Delinquent FBAR Submission Procedures. However, without published IRS guidance confirming the availability of relief, there is no assurance that such filings will avoid penalties. Under Internal Revenue Manual 4.26.16.3.11, taxpayers whose violations were non-willful and attributable to reasonable cause may file delinquent FBARs and seek relief from civil penalties, but the outcome is discretionary and depends on the taxpayer’s particular facts and circumstances. For taxpayers whose noncompliance was non-willful, the Streamlined Offshore Procedures may offer a more structured path to compliance. These procedures generally require the filing of amended returns and delinquent FBARs, payment of any tax and interest due, and a certification under penalties of perjury that the violations were non-willful. The applicable penalty is generally 5% of the highest aggregate balance or value of the covered foreign financial assets during the penalty period. However, these procedures generally apply only if the taxpayer also failed to report income from the foreign accounts or assets.
In light of the IRS’s removal of its formal Delinquent FBAR Submission Procedures guidance—which may signal a shift in its FBAR enforcement approach—taxpayers should consult qualified professionals and carefully assess their specific facts, including the strength of any reasonable-cause or non-willfulness explanation for prior FBAR nonfiling or other noncompliance.