Unreported foreign accounts have three paths back into compliance, and choosing the right lane is the entire game - because the middle lane runs on a sworn certification that, chosen wrongly, manufactures a worse problem than the original. Here is the lane analysis.
Know What Triggered the Duty
The FBAR files annually when your foreign financial accounts, aggregated, exceeded $10,000 at any moment in the year - independent of whether they earned anything. The definition sweeps broadly: bank and brokerage accounts, many foreign pensions and insurance products with cash value, accounts you merely hold signature authority over. FATCA's own form runs in parallel at higher thresholds. And the penalty math changed favorably: the Supreme Court's Bittner decision settled that non-willful penalties apply per form, not per account - collapsing the nightmare arithmetic for people with many accounts and several missed years.
Choose the Lane
Lane one - clean income, missed forms: the delinquent FBAR procedures. File the late reports with an explanation; no penalty. Lane two - unreported income with non-willful conduct: the streamlined procedures. Three amended returns, six years of FBARs, a sworn non-willfulness certification, and a 5 percent penalty for U.S. residents - zero for qualifying taxpayers abroad. Lane three - conduct with willful color: the voluntary disclosure practice, trading a defined penalty structure for protection against criminal referral. The fork between lanes two and three is the certification: non-willfulness sworn falsely converts a civil cleanup into evidence, which is why the lane analysis happens under attorney-client privilege before anything gets filed or signed.
Move Before the Banks Do
FATCA means foreign banks report American account holders regardless - the government is receiving your data on its own schedule, and every favorable lane requires arriving before it connects the dots. The analysis itself is one privileged conversation: the accounts, the years, the conduct, honestly - and the lane follows from the facts. I have run this fork many times, including for Americans abroad whose whole problem was never knowing the rules existed. Let's run yours this week.