The IRS quietly ended the Delinquent FBAR Submission Procedures: what taxpayers with delinquent FBARs need to know 

Summary

• For years, the Internal Revenue Service (“IRS”) posted on an IRS website that it would not penalize a late Foreign Bank Account Report (“FBAR”), the annual report of your foreign bank accounts, if you had reported all your income and paid all your corresponding income tax. On July 1, 2026, the IRS quietly took that written assurance off its website.
• This does not mean automatic penalties. FBAR penalties have never been automatic. The law says the IRS may impose one, not that it must, and in practice a penalty is only considered during an examination.
• The instruction is not entirely gone. The same no-penalty guidance still exists in the IRS’s internal manual for its own examiners. What taxpayers lost is a public assurance they could point to, not the underlying relief.
• The stakes are real. Non-willful penalties currently reach up to $16,536 per report, and willful penalties far more. A well-documented reasonable-cause position is now what protects you.
• This is part of a pattern. The IRS has been ending or narrowing these voluntary programs one by one, so the safest window is the one open now, before the IRS makes contact.
• If you have unfiled FBARs, the smartest move is to talk to a professional before you file, not after. The right path depends on your facts, and the choice you make now can change the outcome. Kaufman Rossin can help you weigh your options.

What happened

For years, most U.S. taxpayers who forgot to file the annual report of their foreign bank accounts, known as the FBAR, had a written assurance they could count on. If you reported all your income, paid all the tax you owed on those foreign accounts, and had not already been contacted by the IRS about an audit or missing returns for those years, the IRS said it would not penalize you for filing the report late.

That written promise has now been taken down from the IRS website.* For Americans living abroad, and for cross-border families who often discover the FBAR requirement years after the fact, that disappearance is unsettling. Without the full story, it looks like the safety net is gone. The reality is more reassuring, and worth understanding before you do anything.

What changed, and what didn’t

On July 1, 2026, the IRS removed the Delinquent FBAR Submission Procedures from its website. That page, posted since 2014, made a simple promise: file the late report, meet the conditions, and pay no penalty. It came down quietly, with no press release or explanation, and the links pointing to it disappeared at the same time.

A variation on these instructions is still in the IRS’s own internal rulebook, the Internal Revenue Manual, at section 4.26.16.3.11(4), which tells examiners not to impose a penalty when a taxpayer meets the delinquent submission requirements, and otherwise has reasonable cause. (emphasis added). That provision was last updated in June 2021. In our experience, when the IRS removes a public-facing page like this one, it often revises the internal revenue manual shortly thereafter, so it’s reasonable to think this provision could be updated soon to further emphasize the importance of reasonable cause. That is not a certainty, and it hasn’t happened yet, but the practical point is timing. If you’re already under examination and you qualify, that section matters a great deal right now. If you’re only now weighing a late filing, it’s safer to assume you may not be able to lean on it if your case is ever examined.

What the FBAR procedures provided

The FBAR is filed with a Treasury agency called FinCEN, separately from your tax return. You must file it if your foreign financial accounts together top $10,000 at any point in the year.

The Delinquent FBAR Submission Procedures covered one narrow but very common situation: a taxpayer whose return already reported all the income and paid all the tax tied to the account, who was not under examination or investigation, who had not been contacted about the missing FBAR, and whose only slip-up was the late form itself. For that person, the IRS put its no-penalty assurance in writing, which was especially valuable when the foreign accounts earned little or no income. Anyone who also had to amend a return or pay additional tax was pointed instead to the Streamlined Filing Compliance Procedures or the Voluntary Disclosure Practice, and that’s still the case.

Losing the written assurance doesn’t mean automatic penalties

It’s important to note that taking down the webpage with the explicit guidance doesn’t mean the IRS will start penalizing people by default. A late FBAR does not trigger an automatic penalty.

The IRS says as much on its website, noting that you may face penalties and that whether one applies “depends on facts and circumstances.” You can read the current page here: Report of Foreign Bank and Financial Accounts (FBAR) | Internal Revenue Service. That word choice traces back to the law: the statute authorizing FBAR penalties, 31 U.S.C. 5321, says the government may impose a penalty, not that it must. That same permissive “may” carries through the rules handing enforcement from FinCEN to the IRS (31 C.F.R. 1010.810), and as a matter of current practice the IRS does not assess an FBAR penalty without first conducting an examination.

That last point is the key to the whole change, and it’s genuinely good news. Because a penalty is only imposed upon an examination, the old page really meant that if your late FBAR was ever examined and you qualified, the IRS wouldn’t penalize you. So, removing the page doesn’t expose you to a new penalty per se. It moves the question of relief from an automatic guarantee at the front end to a closer look at your particular facts if an examination happens.

Two provisions in the internal manual reinforce this: section 4.26.16.3.11 still tells examiners not to assert a penalty for a non-willful failure that was due to reasonable cause where the account was properly reported, and section 4.26.16.5.2.1 leaves whether to penalize, and how much, to the examiner’s judgment on the facts, including whether a simple warning letter would do instead.

A clear pattern has emerged

These programs exist because the IRS chooses to offer them, not because a law requires them, which means it can change or end them whenever it likes, and lately it has. The IRS shut down the Offshore Voluntary Disclosure Program in 2018, steering willful cases to the Voluntary Disclosure Practice, which is itself now being reworked. It also revised the Delinquent International Information Return Submission Procedures, stripping out language that once promised qualifying taxpayers no penalty for late information returns when no tax was owed. The removal of the delinquent FBAR procedures is simply the latest sign that programs built on IRS enforcement authority can change fast, and without warning.

You still have options

The people most affected by the updated IRS actions are the ones who did nothing wrong except miss a form. If that’s you, you can still file your late FBARs, just without an explicit assurance from the IRS. The Streamlined Filing Compliance Procedures still offer a more certain path, but they don’t fit every situation and can carry a 5% penalty on the foreign assets that should have been reported. The alternative is to file through normal channels with a well-documented explanation of why the filing was late, but the stakes are real: non-willful penalties currently run up to $16,536 per report, and willful penalties reach the greater of $165,353 or half the account balance. Even so, for someone who fits the delinquent-FBAR profile, the manual itself offers reassurance, with an example at section 4.26.16.5.5.1(7) indicating that an honest oversight with no unreported income behind it should not draw a willful penalty.

What to think about now

• Build your reasonable-cause record. If you properly reported and paid tax on the foreign account income, you already have a strong case for relief, strongest when documented now rather than after a notice arrives.
• Weigh the Streamlined Procedures as an alternative. For some, the 5% penalty is a fair price for peace of mind; for others it’s not. Which camp you’re in depends on your facts.
• Consider moving first. The IRS has long advised that if it hasn’t contacted you and you’re not under investigation, you should file as soon as possible. Once the IRS reaches out, most avenues for relief close.
• Be careful with quiet disclosures. Filing on your own is still an option, but only with a coherent strategy. Done carelessly, it can create more problems than it solves.
• Look at the full picture. Late FBARs often travel with unreported foreign investments, trusts, or pensions. Fixing one while ignoring the rest rarely ends well.

A matter of facts and judgment

The window for the cleanest fix has narrowed, but it hasn’t closed. How you move forward depends on your facts, your documentation, and sound judgment in a way it didn’t before July 1. This is precisely the kind of situation where getting advice before you file can change how things turn out.

Kaufman Rossin’s Tax Controversy and International Tax teams advise U.S. taxpayers with foreign financial accounts, foreign pensions, and cross-border reporting obligations who need to get back on track. If you have unfiled FBARs, or you’re simply not sure where you stand, we can help you weigh your options and choose a path with confidence.

*The assurance language is still visible via the Wayback Machine.

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