# US tax returns and changing citizenship **URL:** \ **Category:** Factual Questions\ **Created:** [January 12, 2019, 7:48pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655 "2019-01-12T19:48:33Z")\ **Posts on this page:** 16\ **Page:** 2
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 13, 2019, 6:28am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/21 "2019-01-13T06:28:25Z")
> [@Malden\_Capell](#): > > Thanks for the responses everyone, I agree she needs to find a tax expert and file. I think she’s terrified of getting into trouble so has procrastinated somewhat. > > Regarding the FBAR form, it’s likely she did have enough savings over the threshold in her personal savings account to require it. Does anyone know what penalty that might face? A percentage of savings over $10,000 is skimmed off or something? I don’t think you need to panic about penalties, but you do need to get professional help to get all the delinquent tax returns and FBARs sorted out. The IRS are not total dicks in my experience. The scary _potential_ penalties are there to make sure that people know they are serious about this, and of course to cause some serious pain for people deliberately trying to avoid tax. See here: > **[Delinquent FBAR submission procedures | Internal Revenue Service](https://www.irs.gov/individuals/international-taxpayers/delinquent-fbar-submission-procedures)** > > Taxpayers who do not need to use either the IRS Criminal Investigation Voluntary Disclosure Practice or the Streamlined Filing Compliance Procedures to file delinquent or amended tax returns to report and pay additional tax, but who: > [@](#): > > The IRS will not impose a penalty for the failure to file the delinquent FBARs if you properly reported on your U.S. tax returns, and paid all tax on, the income from the foreign financial accounts reported on the delinquent FBARs, and you have not previously been contacted regarding an income tax examination or a request for delinquent returns for the years for which the delinquent FBARs are submitted. Now, since she hasn’t filed tax returns yet either, that doesn’t give complete assurance that there won’t be a penalty. But if she comes forward voluntarily, she has the kind of accounts that an “ordinary” working/middle class person would have - i.e. she’s not shunting large amounts of money around, and she’s not a very wealthy person who really would be expected to know their filing obligations - then I think the probability that they will impose any financial penalty is negligible. They are serious about people being in compliance, but ultimately they are not trying to screw ordinary people with disproportionate penalties. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [January 13, 2019, 6:31am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/22 "2019-01-13T06:31:41Z")
> [@Riemann](#): > > The IRS are not total dicks in my experience. The scary _potential_ penalties are there to make sure that people know they are serious about this, and of course to cause some serious pain for people deliberately trying to avoid tax. This. I have not had very many interactions with the IRS personally, but the ones I have had have all been pretty positive. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 13, 2019, 6:51am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/23 "2019-01-13T06:51:10Z")
> [@chappachula](#): > > The other set is the FBAR form, which Americans living overseas must file(online only.The deadline is April 30, with no exceptions allowed.) The FBAR deadline changed. It’s now consistent with the tax return deadline, April 15th with automatic extension to October 15th. > **[Report of Foreign Bank and Financial Accounts (FBAR) | Internal Revenue Service](https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar)** > > Per the Bank Secrecy Act, every year you must report certain foreign financial accounts, such as bank accounts, brokerage accounts and mutual funds, to the Treasury Department and keep certain records of those accounts. You report the accounts by... At the moment, it appears that you don’t even have to file any form to get the extension - so effectively it’s just an October 15th deadline. ---
**Author:** ![Melbourne](https://avatars.discourse-cdn.com/v4/letter/m/b5e925/32.png) [@Melbourne](https://boards.straightdope.com/u/Melbourne)\ **Post date:** [January 13, 2019, 7:17am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/24 "2019-01-13T07:17:56Z")
> [@Malden\_Capell](#): > > does that mean she’s fine? > Sent from my iPad using Tapatalk She’s not able to surrender her American Citizenship until she sorts out her American tax for the last couple of years. Whether that’s “fine” or not is a matter of opinion. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 13, 2019, 7:25am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/25 "2019-01-13T07:25:17Z")
> [@Melbourne](#): > > She’s not able to surrender her American Citizenship until she sorts out her American tax for the last couple of years. Whether that’s “fine” or not is a matter of opinion. Where are you getting the idea that she wants to surrender U.S. citizenship? There’s no indication of that in the OP. ---
**Author:** ![Hari\_Seldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hari_seldon/32/5173_2.png) [@Hari\_Seldon](https://boards.straightdope.com/u/Hari_Seldon)\ **Post date:** [January 13, 2019, 2:21pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/26 "2019-01-13T14:21:54Z")
> [@Riemann](#): > > The FBAR deadline changed. It’s now consistent with the tax return deadline, April 15th with automatic extension to October 15th. > > [https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar](https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar) > > At the moment, it appears that you don’t even have to file any form to get the extension - so effectively it’s just an October 15th deadline. Are you sure about that? It always was an automatic 2 month extension to June 15 and I am unaware that that has changed. Of course, you can always ask for a further extension. Incidentally, even if you renounce your citizenship (itself an expensive process), you are still required to file tax returns for ten more years. Although I cannot imagine how they could enforce that. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 13, 2019, 4:40pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/27 "2019-01-13T16:40:25Z")
> [@Hari\_Seldon](#): > > Are you sure about that? Did you not see the IRS link? And pdf of instrusctions here: [https://www.fincen.gov/sites/default/files/shared/FBAR%20Line%20Item%20Filing%20Instructions.pdf](https://www.fincen.gov/sites/default/files/shared/FBAR%20Line%20Item%20Filing%20Instructions.pdf) > [@](#): > > Extension of Time to File. > FinCEN will grant filers failing to meet the FBAR annual due date of April 15th an automatic extension to October 15th each year. Accordingly, specific requests for an extension are not required ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [January 13, 2019, 8:36pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/28 "2019-01-13T20:36:42Z")
Even if she does drop US citizenship, I believe the IRS still holds her on the hook for taxes. I recall an SD column mentioning this. But maybe she’ll just be a dual citizen? ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 13, 2019, 9:39pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/29 "2019-01-13T21:39:43Z")
> [@Alley\_Dweller](#): > > Not true. If you have a certain amount of income, as specified in the law, you are required to file a tax return whether or not you owe any tax. Owing tax is not an element of the crime under 26 USC Sec 7203. > > Take the case of Richard P Hairston, who was charged with three counts of wilful failure to under 26 USC 7203. His lawyer wanted to present evidence that he did not owe any tax and would indeed have received a refund if he had filed. The trial court judge refused to admit this evidence because it was irrelevant under the law. He was convicted. The conviction was appealed to the 10th Circuit, [which said](https://casetext.com/case/us-v-hairston-34): > U.S. v. Hairston, 819 F.2d 971 (10th Cir. 1987) > > Other courts have similarly ruled. > > Mr Hairston’s convictions were upheld. That’s true. If you dont owe you still have to file. But there’s no penalty for not doing so, unless you are doing so wilfully. But if your income is below a certain limit you dont have to file. In that case, and others, it was the fact that the defendant was a Tax Protestor, and thus couldn’t claim a good faith misunderstanding of the duty to file a return. If you honestly believe you didn’t have to file and dont owe, you are not penalized. \*In the years 1977, 1978, 1979, and 1980, Mr. Hairston filed returns completed with only the words “object,” “self-incrimination,” or “none.” He filed no returns in 1981 and 1982. He received numerous registered letters from the Internal Revenue Service informing him of his obligation to file a return and the possibility of criminal liability for failure to comply. In the years 1980, 1981, and 1982, Mr. Hairston submitted thirty-one withholding certificates commonly known as “W-4s” on which he claimed to be exempt from withholding requirements.Mr. Hairston’s defense at trial was that he did not file due to a bona fide misunderstanding as to his legal duty to file a return. A good faith misunderstanding of the duty to file a return can negate the willfulness element of a failure-to-file charge. See United States v. Murdock, 290 U.S. 389, 396, 54 S.Ct. 223, 226, 78 L.Ed. 381 (1933); United States v. Ware, 608 F.2d 400, 405 (10th Cir. 1979). The misunderstanding need not have a reasonable basis to provide a defense. See United States v. Phillips, 775 F.2d 262, 264 (10th Cir. 1985). \* ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 13, 2019, 9:40pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/30 "2019-01-13T21:40:46Z")
> [@Alley\_Dweller](#): > > Actually, an individual cannot directly efile a tax return with the IRS (unless he has gone to the trouble of being qualified as an Authorized eFile Provider). It may seem to you the when you press the “efile” button in TurboTax that you are sending your return to the IRS, but you are not. You are actually sending it to Intuit (the maker of TurboTax) which then does some verification and formats it in the efile format and then transmits it to the IRS. Intuit is the Authorized eFile Provider. Which is why I said “sorta”. For your purposes, you are e-filing. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [January 13, 2019, 9:42pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/31 "2019-01-13T21:42:59Z")
> [@Riemann](#): > > … The IRS are not total dicks in my experience. The scary _potential_ penalties are there to make sure that people know they are serious about this, and of course to cause some serious pain for people deliberately trying to avoid tax. > … Some Revenue officers (collections) can be dicks, but in general, they are just bureaucrats doing a job. ---
**Author:** ![Hari\_Seldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hari_seldon/32/5173_2.png) [@Hari\_Seldon](https://boards.straightdope.com/u/Hari_Seldon)\ **Post date:** [January 13, 2019, 11:44pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/32 "2019-01-13T23:44:32Z")
> [@Riemann](#): > > Did you not see the IRS link? > And pdf of instrusctions here: > > [https://www.fincen.gov/sites/default/files/shared/FBAR%20Line%20Item%20Filing%20Instructions.pdf](https://www.fincen.gov/sites/default/files/shared/FBAR%20Line%20Item%20Filing%20Instructions.pdf) I see. So the FUBAR has a six month extension, but the basic tax filing only two. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 14, 2019, 12:07am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/33 "2019-01-14T00:07:30Z")
> [@Hari\_Seldon](#): > > I see. So the FUBAR has a six month extension, but the basic tax filing only two. What do you mean by “basic tax filing”? You could always get an automatic 6-month extension (until Oct 15) to file your tax return; the change brought the FBAR filing deadline into line with that. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 14, 2019, 12:28am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/34 "2019-01-14T00:28:53Z")
Oh, to answer my own question, I now realize what you mean. If you’re non-resident, you get a first automatic extension to June 15th to both file and _pay_. But you still get additional the same additional extension as a resident until October 15th to _file_. ---
**Author:** ![md2000](https://avatars.discourse-cdn.com/v4/letter/m/73ab20/32.png) [@md2000](https://boards.straightdope.com/u/md2000)\ **Post date:** [January 14, 2019, 7:00am UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/35 "2019-01-14T07:00:12Z")
Just curious - I see the exemptions changed for deductions with the recent changes to income and other taxes (i.e. limit how much you can deduct state taxes paid). Does this have any effect on foreign taxes paid as a deduction? Any other implications? ---
**Author:** ![kferr](https://avatars.discourse-cdn.com/v4/letter/k/71e660/32.png) [@kferr](https://boards.straightdope.com/u/kferr)\ **Post date:** [January 14, 2019, 1:41pm UTC](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655/36 "2019-01-14T13:41:56Z")
I naturalized as a UK citizen over 15 years ago and other than filling in “place of birth” on a form and showing a birth certificate the UK didn’t much care where I was from or if I’d kept up to date with tax filing. About 6 years ago I decided to renounce US citizenship because of FATCA. I’d always filed returns but had ignored FBAR so hired a “specialist” to get my ducks in a row. I quote “specialist” because she actually wasn’t very good. The way she recalculated things I ended up owing around $1000 for each of the five years she worked on. I sent off those payments, and a few months later started getting refund cheques back for the amounts I’d paid. After the renunciation was complete I stopped filing anything except in 2017. I cashed out a pension from when I worked in the US and filed to get most of the pre-deducted tax back. The same day I got that refund back I also got a cheque for $3.13 for a 2011 tax refund. The IRS works in mysterious ways. [Previous page](https://boards.straightdope.com/t/us-tax-returns-and-changing-citizenship/827655.md?page=1)