Article Guide
The 14653 form, officially titled "Certification by U.S. Person Residing Outside of the United States for Streamlined Foreign Offshore Procedures," serves as a vital tool for U.S. taxpayers living abroad who wish to rectify their tax filing status. This form is essential for individuals who have not reported all income, paid all taxes, or submitted required information returns, including Foreign Bank Account Reports (FBARs). It allows eligible taxpayers to come into compliance with U.S. tax laws while minimizing penalties. By submitting this form, taxpayers certify that they are providing delinquent or amended income tax returns for the past three years and affirm their non-willful conduct regarding any past omissions. The form also requires detailed disclosures about residency status, reasons for non-compliance, and specific information about foreign financial assets. Importantly, it emphasizes the need for accurate record-keeping and the potential consequences of failing to comply with IRS requirements. Taxpayers must acknowledge that their submissions may be subject to review and that any evidence of willful misconduct could lead to severe penalties. Understanding the nuances of the 14653 form is crucial for taxpayers seeking to navigate the complexities of U.S. tax obligations while living abroad.
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Form 14653
(October 2017)
Department of the Treasury - Internal Revenue Service
Certification by U.S. Person Residing Outside of the United
States for Streamlined Foreign Offshore Procedures
OMB Number
Name(s) of taxpayer(s)
TIN(s) of taxpayer(s)
Telephone number
Mailing address
City
State
ZIP code
Note: If this certification is a joint certification, the statements will be considered made on behalf of both spouses, even though the pronoun "I" is used. If spouses submitting a joint certification have different reasons for their failure to report all income, pay all tax, and submit all required information returns, including FBARs, they must state their individual reasons separately in the required statement of facts.
Certification
I am providing delinquent or amended income tax returns, including all required information returns, for each of the most recent 3 years for which the U.S. tax return due date (or properly applied for extended due date) has passed. The tax and interest I owe for each year are as follows
Year
(list years in order)
Amount of Tax I Owe Shown On
(Form 1040 or Form 1040X)
Interest
Total
Total
Note: Your payment should equal the total tax and interest due for all three years. You may receive a balance due notice or a refund if the tax or interest is not calculated correctly.
I failed to report income from one or more foreign financial assets during the above period.
I meet all the other eligibility requirements for the Streamlined Foreign Offshore procedures.
If I failed to timely file correct and complete FBARs for any of the last six years, I have now electronically filed those FBARs.
I agree to retain all records related to my income and assets during the period covered by my delinquent or amended returns until three years from the date of this certification. If I was required to file delinquent FBARs in accordance with these procedures, I also agree to retain all records (including, but not limited to, account statements) related to my foreign financial accounts until six years from the date of this certification. Upon request, I agree to provide all such records to the Internal Revenue Service.
My failure to report all income, pay all tax, and submit all required information returns, including FBARs, was due to
I acknowledge the possibility that amended income tax returns I am submitting under the Streamlined Foreign Offshore Procedures may report income for tax years beyond the
I recognize that if the Internal Revenue Service receives or discovers evidence of willfulness, fraud, or criminal conduct, it may open an examination or investigation that could lead to civil fraud penalties, FBAR penalties, information return penalties, or even referral to Criminal Investigation.
I meet the
Note: Both spouses filing a joint certification must meet the
Complete one of the following (two) sections regarding your residency status
If you are a U.S. citizen or lawful permanent resident (i.e., “green card holder”), complete this section:
For the covered tax period, indicate whether you were physically outside the United States for each year. You must have been physically outside the U.S. for at least 330 full days in any one or more of the most recent three years for which the U.S. tax return due date (or properly applied for extended due date) has passed, and you must not have had a U.S. abode. For more information on the meaning of “abode” see IRS Publication 54.
Catalog Number 67042A |
www.irs.gov |
Form 14653 (Rev. |
Page of
I was physically outside the United States for at least 330 full days (answer Yes or No for each year)
Year
Yes
No
Both spouses filing a joint certification must meet the
If you are not a U.S. citizen or lawful permanent resident, complete this section:
If you are not a U.S. citizen or a lawful permanent resident, please attach to this certification your computation showing that you did not meet the substantial presence test under I.R.C. sec. 7701(b)(3). Your computation must disclose the number of days you were present in the U.S. for the three years included in your Streamlined Foreign Offshore Procedures submission and the previous two years. If you do not attach a complete computation showing that you did not meet the substantial presence test, your submission will be considered incomplete and your submission will not qualify for the Streamlined Foreign Offshore Procedures.
Both spouses filing a joint certification must meet the
Note: You must provide specific facts on this form or on a signed attachment explaining your failure to report all income, pay all tax, and submit all required information returns, including FBARs. Any submission that does not contain a narrative statement of facts will be considered incomplete and will not qualify for the streamlined penalty relief.
Provide specific reasons for your failure to report all income, pay all tax, and submit all required information returns, including FBARs. Include the whole story including favorable and unfavorable facts. Specific reasons, whether favorable or unfavorable to you, should include your personal background, financial background, and anything else you believe is relevant to your failure to report all income, pay all tax, and submit all required information returns, including FBARs. Additionally, explain the source of funds in all of your foreign financial accounts/assets. For example, explain whether you inherited the account/asset, whether you opened it while residing in a foreign country, or whether you had a business reason to open or use it. And explain your contacts with the account/asset including withdrawals, deposits, and investment/ management decisions. Provide a complete story about your foreign financial account/asset. If you relied on a professional advisor, provide the name, address, and telephone number of the advisor and a summary of the advice. If married taxpayers submitting a joint certification have different reasons, provide the individual reasons for each spouse separately in the statement of facts. The field below will automatically expand to accommodate your statement of facts.
Catalog Number 67042A |
www.irs.gov |
Form 14653 (Rev. |
Page of
Under penalties of perjury, I declare that I have examined this certification and all accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete.
Signature of Taxpayer |
Name of Taxpayer |
Date |
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Signature of Taxpayer (if joint certification) |
Name of Taxpayer (if joint certification) |
Date |
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For Estates Only
Signature of Fiduciary |
Date |
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Title of Fiduciary (e.g., executor or administrator)
Name of Fiduciary
For Paid Preparer Use Only (the signature of taxpayer(s) or fiduciary is required even if this form is signed by a paid preparer)
Signature of Preparer |
Name of Preparer |
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Date |
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Firm’s name |
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Firm’s EIN |
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Firm’s address |
City |
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State |
ZIP code |
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Telephone number |
PTIN |
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Check if |
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Do you want to allow another person to discuss this form with the IRS |
Yes (complete information below) |
No |
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Designee’s name |
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Telephone number |
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Privacy Act and Paperwork Reduction Notice
We ask for the information on this certification by U.S. person residing in the United States for streamlined domestic offshore procedures to carry out the Internal Revenue laws of the United States. Our authority to ask for information is sections 6001, 6109, 7801, 7803 and the regulations thereunder. This information will be used to determine and collect the correct amount of tax under the terms of the streamlined filing compliance program. You are not required to apply for participation in the streamlined filing compliance program. If you choose to apply, however, you are required to provide all the information requested on the streamlined certification. You are not required to provide the information requested on a document that is subject to the Paperwork Reduction Act unless the document displays a valid OMB control number. Books or records relating to a document or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. Section 6103, however, allows or requires the Internal Revenue Service to disclose or give this information to others as described in the Internal Revenue Code. For example, we may disclose this information to the Department of Justice to enforce the tax laws, both civil and criminal, and to cities, states, the District of Columbia, and U.S. commonwealths or possessions to carry out their tax laws. We may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. Failure to provide this information may delay or prevent processing your application. Providing false information may subject you to penalties. The time needed to complete and submit the streamlined certification will vary depending on individual circumstances. The estimated average time is: 8 hours
Catalog Number 67042A |
www.irs.gov |
Form 14653 (Rev. |
Form Specifications
| Fact Name | Description |
|---|---|
| Purpose of Form | The 14653 form is used by U.S. persons living outside the United States to certify eligibility for the Streamlined Foreign Offshore Procedures, allowing them to come into compliance with U.S. tax obligations. |
| Eligibility Requirements | To qualify, individuals must have failed to report income, pay taxes, or submit required information returns, including FBARs, due to non-willful conduct. |
| Record Retention | Taxpayers must retain all records related to their income and foreign financial accounts for three years from the date of certification or six years for FBARs. |
| Joint Certification | In cases of joint certification, both spouses must meet the non-residency requirements and provide individual reasons for any failures in reporting income or taxes. |
| Governing Law | This form is governed by the Internal Revenue Code, specifically under I.R.C. § 6501(a) regarding assessment limitations and I.R.C. sec. 7701(b)(3) for the substantial presence test. |
14653: Usage Guidelines
Completing Form 14653 is a critical step for U.S. persons residing outside the United States who are seeking to participate in the Streamlined Foreign Offshore Procedures. After filling out the form, it should be submitted to the Internal Revenue Service along with any required documentation. Below are the steps to accurately fill out this form.
- Provide Taxpayer Information: Enter the names, taxpayer identification numbers (TINs), telephone number, mailing address, city, state, and ZIP code of the taxpayer(s).
- Certification Section: Indicate that you are providing delinquent or amended income tax returns for the last three years. List the years, the amount of tax owed, and any applicable interest.
- Failure to Report Income: Confirm that you failed to report income from foreign financial assets and meet all eligibility requirements for the Streamlined Foreign Offshore Procedures.
- FBAR Filing: State whether you have electronically filed any required FBARs for the last six years.
- Record Retention Agreement: Agree to retain all records related to your income and assets for three years from the date of certification, and six years for FBARs, if applicable.
- Non-Willful Conduct Declaration: Acknowledge that your failure to report was due to non-willful conduct.
- Residency Status: Complete the appropriate section regarding your residency status, indicating whether you were physically outside the U.S. for at least 330 full days in any of the last three years.
- Statement of Facts: Provide a detailed narrative explaining your reasons for failing to report income, pay taxes, and submit required information returns, including FBARs. Include personal and financial background information.
- Sign and Date: Sign and date the form. If applicable, have the joint taxpayer sign as well. If a fiduciary is involved, they must also sign and provide their title.
- Preparer Information: If a paid preparer assists with the form, they must provide their signature, name, firm details, and other required information.
Your Questions, Answered
What is Form 14653?
Form 14653 is a certification form used by U.S. persons residing outside of the United States to participate in the Streamlined Foreign Offshore Procedures. This form allows individuals to certify their eligibility for these procedures, which are designed to help taxpayers who have failed to report foreign income or financial assets. It includes sections for providing delinquent or amended tax returns and for explaining the reasons for non-compliance.
Who should use Form 14653?
This form is intended for U.S. citizens and lawful permanent residents (green card holders) who have not reported all income, paid all taxes, or submitted all required information returns, including FBARs, due to non-willful conduct. It is specifically for those who meet the eligibility requirements for the Streamlined Foreign Offshore Procedures and have been physically outside the U.S. for a significant amount of time.
What information do I need to provide on Form 14653?
When completing Form 14653, you will need to provide your name, taxpayer identification number (TIN), contact information, and details about your residency status. You must also indicate the years for which you are submitting delinquent or amended returns, the amount of tax owed, and the interest due. Additionally, you will need to explain your reasons for failing to report income and provide a narrative statement of facts regarding your foreign financial accounts.
What are the non-residency requirements for this form?
To qualify for the Streamlined Foreign Offshore Procedures, you must have been physically outside the United States for at least 330 full days during one or more of the most recent three years for which the U.S. tax return due date has passed. You must also confirm that you did not have a U.S. abode during this time. If you are not a U.S. citizen or lawful permanent resident, you must demonstrate that you did not meet the substantial presence test.
What happens if I do not include a narrative statement of facts?
Including a narrative statement of facts is essential for your submission to be considered complete. If you do not provide this narrative, your Form 14653 will be deemed incomplete, and you will not qualify for the streamlined penalty relief. This statement should detail your personal and financial background, the reasons for your non-compliance, and any relevant information about your foreign financial accounts.
Can both spouses file a joint certification using Form 14653?
Yes, both spouses can file a joint certification using Form 14653. However, both must meet the non-residency requirements. If each spouse has different reasons for failing to report income or submit required returns, they must provide their individual reasons separately within the narrative statement of facts.
What should I do if I relied on a professional advisor?
If you relied on a professional advisor for guidance regarding your tax obligations, you should include their name, address, and telephone number in your narrative statement. Additionally, summarize the advice they provided. This information may help clarify your situation and support your claim of non-willful conduct.
What are the potential consequences of submitting false information on Form 14653?
Submitting false information on Form 14653 can lead to serious consequences, including penalties from the IRS. If the IRS discovers evidence of willfulness, fraud, or criminal conduct, it may initiate an examination or investigation, which could result in civil fraud penalties or even criminal charges. It is crucial to ensure that all information provided is accurate and truthful.
Common mistakes
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Incomplete Information: One of the most common mistakes is failing to provide all required information. Each section of the form must be filled out completely. Omitting details, such as the taxpayer identification number (TIN) or mailing address, can lead to delays or rejection of the application.
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Incorrect Tax Calculations: Taxpayers often miscalculate the total tax and interest owed. It is essential to accurately list the amounts for each year, as discrepancies can result in a balance due notice or a refund. Double-checking calculations before submission is crucial.
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Failure to Provide a Narrative Statement: Many individuals neglect to include a detailed narrative explaining their failure to report income and submit required information returns. This statement is necessary for the IRS to understand the context of the situation. Without it, the submission may be deemed incomplete.
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Ignoring Residency Requirements: Taxpayers sometimes overlook the residency requirements for the Streamlined Foreign Offshore Procedures. Both spouses must meet these requirements if filing jointly. Not disclosing the number of days spent in the U.S. or providing inaccurate residency information can jeopardize the application.
Documents used along the form
When navigating the Streamlined Foreign Offshore Procedures, several forms and documents often accompany Form 14653. Each of these documents plays a vital role in ensuring compliance with U.S. tax laws and streamlining the process for individuals residing outside the United States. Here’s a brief overview of the most commonly used forms and documents alongside Form 14653:
- Form 1040: This is the standard individual income tax return form used by U.S. citizens and residents to report their income, claim deductions, and calculate their tax liability. It is essential for reporting any income earned during the years in question.
- Form 1040X: This form is used for amending a previously filed tax return. If there were errors or omissions in the original Form 1040, a taxpayer would submit Form 1040X to correct those mistakes.
- FBAR (FinCEN Form 114): The Foreign Bank Account Report is required for U.S. persons with foreign financial accounts exceeding certain thresholds. It must be filed electronically and is crucial for reporting foreign bank accounts.
- Form 8938: This form is used to report specified foreign financial assets. U.S. taxpayers must file it if their foreign assets exceed certain thresholds, making it an important part of the compliance process.
- Statement of Facts: This is a narrative document that explains the reasons for any failures to report income or file required returns. It provides context and details about the taxpayer's situation, which is necessary for the IRS to assess the case appropriately.
- Proof of Residency: Documentation that verifies the taxpayer’s physical presence outside the U.S. for the required number of days. This can include travel itineraries, rental agreements, or other official documents that support the claim of non-residency.
Understanding these forms and documents is crucial for anyone considering the Streamlined Foreign Offshore Procedures. Properly completing and submitting these materials can greatly enhance the chances of a successful resolution with the IRS. Always ensure that you have all the necessary documentation ready to support your claims and facilitate the process.
Similar forms
- Form 1040: This is the standard individual income tax return form used by U.S. taxpayers. Like Form 14653, it requires reporting of income, deductions, and credits to determine tax liability.
- Form 1040X: This form is used to amend a previously filed Form 1040. Similar to Form 14653, it allows taxpayers to correct errors or make changes in income reporting.
- FBAR (FinCEN Form 114): This form is required for U.S. persons to report foreign bank accounts. Both the FBAR and Form 14653 deal with the reporting of foreign financial assets.
- Form 8938: This form is used to report specified foreign financial assets. Like Form 14653, it is aimed at ensuring compliance with U.S. tax laws regarding foreign assets.
- Form 4868: This form allows taxpayers to request an extension for filing their income tax return. Similar to Form 14653, it involves deadlines and compliance with tax obligations.
- Form 8857: This form is used to request innocent spouse relief from joint tax liability. Both forms address situations where taxpayers seek relief from tax obligations.
- Form 656: This form is used to apply for an Offer in Compromise with the IRS. Similar to Form 14653, it involves negotiating tax liabilities and compliance issues.
- Form 4506-T: This form allows taxpayers to request a transcript of their tax return. Like Form 14653, it can be used to verify information for compliance purposes.
Dos and Don'ts
When filling out Form 14653, it is essential to follow specific guidelines to ensure accuracy and compliance. The following list outlines actions to take and avoid during this process:
- Do: Provide accurate personal information, including names, taxpayer identification numbers (TINs), and contact details.
- Do: Ensure that all required tax returns and information returns for the past three years are included.
- Do: Clearly state your reasons for failing to report income and submit required returns.
- Do: Retain all relevant records related to income and foreign financial accounts for the specified periods.
- Don't: Leave any sections of the form incomplete; all information must be provided.
- Don't: Use vague language when explaining your reasons for non-compliance; be specific and detailed.
- Don't: Submit the form without reviewing it for errors or omissions.
- Don't: Fail to attach any necessary documents, such as computations for non-residency status if applicable.
By adhering to these guidelines, individuals can better navigate the complexities of Form 14653, ensuring a smoother submission process.
Misconceptions
Understanding Form 14653 can be challenging due to various misconceptions surrounding it. Here are nine common misunderstandings:
- Misconception 1: The form is only for U.S. citizens.
- Misconception 2: You must have lived outside the U.S. for three full years.
- Misconception 3: Filing this form guarantees penalty relief.
- Misconception 4: You can submit the form without providing a narrative explanation.
- Misconception 5: Only tax returns need to be amended.
- Misconception 6: You can ignore foreign financial accounts if they are under a certain amount.
- Misconception 7: The IRS does not check the accuracy of the information provided.
- Misconception 8: You can wait to file Form 14653 until after receiving a notice from the IRS.
- Misconception 9: All spouses must have the same reasons for failing to report income.
This is incorrect. Form 14653 is applicable to both U.S. citizens and lawful permanent residents (green card holders) who reside outside the United States.
While the form requires that you have been outside the U.S. for at least 330 full days in one or more of the last three years, it does not mandate three continuous years of residency outside the U.S.
Filing Form 14653 does not automatically guarantee relief from penalties. The IRS reviews each case individually, and eligibility for relief depends on the circumstances of the failure to report income.
A narrative statement explaining the reasons for failing to report income is crucial. Submissions lacking this explanation may be deemed incomplete and ineligible for streamlined procedures.
In addition to amending tax returns, individuals must also file any required information returns, such as FBARs, to qualify for the streamlined procedures.
All foreign financial accounts must be reported, regardless of their balance. Failing to report any account can jeopardize eligibility for penalty relief.
The IRS has the authority to review submissions and can open an examination if it suspects willful conduct or fraud, which may lead to severe penalties.
It is advisable to file Form 14653 proactively. Waiting for IRS notice may limit options for penalty relief and could result in additional penalties.
While both spouses must meet the non-residency requirements, they can have different reasons for their failures. Each spouse should provide individual explanations in the statement of facts.
Key takeaways
Filling out and using Form 14653 can seem daunting, but understanding its key aspects can simplify the process. Here are some important takeaways:
- Eligibility Requirements: Ensure you meet all eligibility requirements for the Streamlined Foreign Offshore procedures. This includes being a U.S. person residing outside the United States.
- Joint Certification: If you are filing jointly with a spouse, both must meet the non-residency requirements. Individual reasons for non-compliance must be clearly stated.
- Detailed Explanation Required: Provide a comprehensive narrative explaining your failure to report income and file necessary returns. This should include personal and financial background details.
- Retention of Records: Keep all records related to your income and foreign financial accounts for three to six years, depending on the type of records.
- Non-Willful Conduct: You must assert that your failure to report was due to non-willful conduct, which encompasses negligence or misunderstanding of tax laws.
By paying attention to these key points, you can navigate the completion and submission of Form 14653 more effectively.