This site began in 2012 and has a wealth of information, posts and article.
Thanking Parviz Malakouti for his kind words …
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John Richardson – Follow me X.com/@ExpatriationLaw
Welcome to Citizenship Solutions – The blog of John Richardson
https://twitter.com/asalexanderdesk/status/777939199265804288
I am guessing (actually I know for sure) that you arrived here because of some aspect of being a U.S. citizen living outside the United States. Maybe you are a Green Card holder. Perhaps you are a former U.S. resident who has just learned that you may still be subject to U.S. “worldwide taxation” even though are a “tax resident” outside the USA. I also know how you are feeling.
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John Richardson, J.D. – August 13, 2026
Introduction and purpose
This is the third of a series of posts to help you understand Canadian citizenship by descent. Canada’s Bill C-3 which took effect on December 15, 2025 made major changes to Canada’s citizenship laws. By changing it’s “citizenship by descent” rules, Canada has created an opportunity for many U.S. citizens to be formally recognized as Canadian citizens. This series of posts has been designed to understand Canada’s Bill C-3 (effective December 15, 2025) and understand how and why these changes are so valuable for many U.S. citizens.
A series of posts
The first post focused on Understanding The Citizenship By Descent Provisions Of Bill C-3 – The Canada Citizenship Act. Specifically what factual conditions would result in an indiviudal being a Canadian citizen and therefore entitled to a Certificate of Canadian citizenship? (Note that with the exception of naturalization or direct grant, one would, under Canadian law, be a Canadian citizen from birth. Those born in the United States are U.S. citizens from birth. Hence, many people, recognized as Canadian citizens from birth, would be Canada/U.S. dual citizens from birth.)
Understanding The Citizenship By Descent Provisions Of Bill C-3 – The Canada Citizenship Act
The second post is a discussion of “Canadian Citizenship By Descent – A Search For Proof (To Prove The Truth)”
Canadian Citizenship By Descent – A Search For Proof (To Prove The Truth) – 4 Perspectives
If citizenship cannot be proven, it has no functional or practical existence. Therefore, those seeking a Certificate of Canadian citizenship embark on “a search for proof”. Although the law does not establish a formal deadline to submit the application for a “Certificate of Canadian Citizenship”, I suggest applying as quickly as possible. Laws can and do change!
This third post is to explore why eligibility for a “Certificate of Canadian Citizenshp” matters. What good is it to be a Canadian citizen? What role could Canadian citizenship play in your life. So, you are a Canadian citizen? What do you do with it? How can it benefit you and your descendants? I suggest that (particularly as a U.S. citizen) that there are (at least) six ways that having a Canadian passport could enhance your life.
What does it mean to be a Canadian citizen? What does it mean to move to Canada as a Canadian citizen?
This post is organized in the following Parts.
Part A – Taxation is destiny – moving to another country always has tax implications
Part B – If you move to Canada and renounce U.S. citizenship you may be subject to the U.S. “Exit Tax” rules
Part C – A review of who IS a Canadian citizen and entitled to a Certificate of Canadian citizenship”
Part D – I have my certificate of Canadian citizenship – what do I do with it? How do I turn it into a family heirloom? How can I sponsor my spouse?
Part E – Six specific opportunities Canadian citizenship provides to U.S. citizens
Part F – Renouncing U.S. citizenship and having access to the United States as a Canadian citizen
Conclusion
Appendix A – The 877A U.S. Exit Tax Rules
Appendix B – The 877A “dual citizen from birth” exemption to the Exit Tax Rules
Appendix C – The legislative text of the “dual citizen from birth” exemption to “covered expatriate” status
Here we go …
John Richardson, J.D. – August 13, 2026
Introduction
This is the second post in a series of posts designed to explore Canadian citizenship generally and Canada’s citizenship by descent rules specifically. The first post (which I suggest you read first) explained how Canada’s citizenship by descent rules work. If you haven’t read it, I suggest that you read it now.
Understanding The Citizenship By Descent Provisions Of Bill C-3 – The Canada Citizenship Act
For those who prefer a visual blueprint to determine whether you ARE a Canadian citizen see:
This post is organized in the following parts:
Part A – The difference between knowing what to do and doing what you know!
Part B – Proving your parent was a Canadian citizen
Part C – Proving 1095 days of physical presence
Let’s begin.
By John Richardson, J.D. – Toronto, Canada – August 9, 2026
I have organized this post into the following Parts:
Introduction – Explaining the purpose
Part A – Canada’s citizenship by descent law from December 15, 2025 – What the law says
Part B – Understanding the language of Bill C-3 Canada’s citizenship by descent rules
Part C – Parsing the language of Bill C-3: How the legislation compels these conclusions
Part D – A Review: What is the legislative source of these conclusions? How does one get there? – The Text of relevant parts of Bill C-3
Part E – In Summary
Appendix A – Canada Citizenship Act
Appendix B – Canada Justice Minister – Explanation of Bill C-3
Appendix C – Bill C-3 Backgrounder
Appendix D – How To Apply For A Certificate Of Canadian Citizenship
Appendix E – Legislative Summary Of Bill C-3
Appendix F – The Complete Text Of Section 3 Of the Canada Citzenship Act
Introduction – Explaining the purpose
The purpose of this post is narrow. It is to explain how the new “citizenship by descent rules” follow from the text of Section 3(1) of The Canada Citizenship Act.
https://laws-lois.justice.gc.ca/eng/acts/C-29/page-1.html#docCont
Bill C-3 – Canada’s new citizenship law – Effective December 15, 2025
I am going to be honest. I find it very difficult to read the Canada Citizenship Act and make sense of it. I understand what the commentators say that it says. That’s great. But I feel more comfortable if I can understand the legislation, parse the legislation and understand how the sections fit together.
Bottom line: If somebody asks you:
Q. Where in the Canada Citizenship Act does it specifically say that, if a child is born outside of Canada, after December 14, 2025, to a parent who was a Canadian citizen and that Canadian citizen parent was also born outside of Canada, then that parent is required to have 1095 days of physical presence in Canada prior to the child’s birth in order to transmit citizenship to the child?
A. Well, you better be able to provide an answer.
Prologue
This is the Part 2 of two posts motivated by the story of a Canada/U.S. dual citizen living in Canada who sought help from the University of Washington “Low Income Tax Clinic” – “LITC”. The first post is here.
Part 1: The University Of Washington “Low Income Tax Clinic” And A Canadian Student
This was also discussed by “Tax Fairness Abroad“.
It’s worth reading the entire blog post from Tax Fairness Abroad titled “A summer job and bad advice land an American in Canada in international tax court“.
The post references a report from the University of Washington “Low Income Tax Clinic”. (Note that the “LITC” also provided assistance to Gabriel Morrow who is another American abroad who received advice from the clinic.)
The complete text of the “LITC” report AKA the drama of taxing Americans abroad
“Taxpayer is a dual US-Canada citizen; TP is a long-term resident of Canada and is employed there. TP’s father passed away in 2020 and client received an inherited retirement account in 2021 (approximately $110K). TP was misinformed by the retirement account custodian that the “taxes have been paid” (when,in reality, this was just the tax withholding from the transaction). TP believed that taxes had been reported and paid; the retirement account was not included in the 2021 tax return. TP also did not include 1099-income earned while doing a summer job in Canada for a U.S. domiciled company. TP received a notice of deficiency, and a tax court petition was filed. Unfortunately, the TP has a deficiency because the retirement account; nonetheless, IRS appeals refused to apply the LITC’s treaty claim in regard to the 1099 income and is invoking the US-Canada Treaty savings clause. The LITC will be requesting a competent authority determination on this issue (Revenue Procedure 2015-40, Section 6.04(3) and related IRM provisions). However, the TP will still have a liability because of the retirement account taxable income—this liability process will continue through appeals while the competent authority determination is submitted and a determination is received from the IRS.”
What facts can we glean from the report?
It appears that this dual Canada/U.S. citizen who resides in Canada filed a U.S. tax return for the 2021 year. That return omitted both distributions from the U.S. IRA AND income from the summer emmployment performed in Canada. It is likely that the IRS was able to match his Social Security Number with the information returns that had been filed for both the IRA distributions and the wages from the U.S. based employer. Put another way: the existence of the information returns combined with the Social Security Number on the U.S. tax return, alerted the IRS to the two specific income sources that should have been included on the tax return.
Question: What does this imply for Americans abroad who stand to inherit retirement plans or other income generating assets (for example a stock portfolio) from a U.S. relative? This is a recurring question. What about long term Americans abroad who may not be current on their U.S. tax returns? Should those people renounce U.S. citizenship prior to inheriting these assets? Should they remain American? If so, how do they manage U.S. tax compliance? Inheriting assets of a kind that would generate income and require the reporting of that U.S. source income implicates the question of U.S. tax compliance.
Two background points that are worthy of note:
1. The United States does NOT impose tax on the value of an inheritance. Rather it taxes the income generated from that inheritance. As per 102 of the Internal Revenue Code:
Gross income does not include the value of property acquired by gift, bequest, devise, or inheritance.
(Note that your country of residence may impose an inheritance tax.)
2. In most states, depending on the circumstances, it is possible to “disclaim” an inheritance. As always, the Internal Revenue Code – section 2518 – imposes specific procedural requirements. If you want to completely avoid these issues (perhaps because the amount of the inheritance is very small) you should be aware that a disclaimer is possible. That said, to disclaim an inheritance – although there may be good reasons to disclaim an inheritiance – is an erosion of your wealth.
The inheritance from America – The Good, The Bad And The Ugly
Inheritances (and gifts) can be income producing or non-income producing. It seems likely that inheritances that are non-income producing will not produce income tax (and therefore tax filing) consequences. For example, if a U.S. citizen were to receive personal property that would not be used to generate income there would be no presumptive income issues. The problem is more likely to arise where the American abroad receives assets that are (1) income producing and (2) reported as income producing. An obvious example of an income producing inheritance would be an IRA.
This purpose of this post is to discuss the quesion of “income producing inheritances” from various perspectives. The “LITC” case of the Canadian student reinforces why “information returns matter. The effect of the information return (reporting the fact of the inheritance of the IRA and the fact of the employment) is that the IRS would have a reason to expect income to be reported on a U.S. tax return.
If you are a U.S. citizen living outside the United States you should consider the implications of receiving any inheritance, but most particulary an inheritance from the United States. I suggest that the implications should be considered from the following perspectives in Category A, Category B and Category C.
Prologue
This is the first of two blog posts (Part 1 and Part 2) that discuss the University of Washington Low Income Tax Clinic report referencing a dual Canada/U.S. citizen student living and working in Canada.
Part 1 (this) will discuss the report generally and how the circumstances actually trigger the Canada/U.S. tax treaty. Think of it! A few thousand dollars of summer income received by a Canadian student implicates an international tax treaty. Only in America!
Interestingly, the specific factual circumstances include an example of what happens when a U.S. citizen living outside the United States receives a U.S. inheritance that generates U.S. source income. This is a concern for many Americans abroad. It is a complicated area.
Mostly Part 1 will discuss the “LITC” Report. Specifically how the “LITC” viewed the issue. How they incorrectly tried to apply the U.S. Canada tax treaty (apparently) without regard to the “saving clause” which is included in all U.S. tax treaties.
The report seems to say that the taxpayer filed a U.S. tax return for the 2021 tax year and filed to include income which (because of information reporting) the IRS was aware of. This should be of concern to Americans abroad generally. I will discuss this aspect more fully in Part 2.
Part 2 will discuss the specific problem of a U.S. citizen abroad inheriting (or anticipating inheriting) U.S. assets (whether income producing or not). I am making this a separate post because it is a complicated topic. The most rational response to this situation is highly dependent on your factual situation.
In any case, we begin with Part 1 …
Continue reading
Introduction
Exit/Departure taxes are imposed when an individual severs tax residency with a country. In a system of residency based taxation, the tax is imposed when the individual severs residency with the country. For example, if a Canadian were to move from Canada to the United States and ceases to be a resident of Canada, that person would be subject to Canada’s “Departure Tax”. U.S. citizenship is the world’s only “Taxation-based Citizenship”. When an individual relinquishes U.S. citizenship, that person may be subject to the U.S. 877A Exit Tax rules.
Canada and the United States are examples of the most brutal tax systems the world has ever known. This is largely because they both impose taxation on unrealized income. Examples are exit taxes and their CFC rules. Imagine paying tax on income that you have never received?
In the spirit of taxing income that an individual has never received, the United States Exit Tax imposes on certain Americans abroad, who renounce their U.S. citizenship a tax on “pretend” or “deemed” income. The U.S. 877A tax goes beyond – in its scope – any departure tax the world has ever known. Not only does it force a deemed distribution of pensions. But, 877A taxes the pensions of Americans abroad, accumulated while that American was not resident in the United States. Furthermore, 877A taxes that non-U.S. pension more punitively than it would tax a U.S. based pension.
The following post compares the U.S. 877A Exit Tax imposed on the relinquishment of U.S. citizenship with Canada’s Departure Tax imposed when tax residency is severed with Canada.
Both Canada’s Departure Tax and the U.S. Exit Tax were designed to target the super wealthy. They have had their heaviest impact on middle class people. They are examples of the mantra that:
“Sooner or later a class tax becomes a mass tax.”
What follows is a post that I wrote for the Isaac Brock Society. It has broad application. I thought I would provide it on this blog as well.
The Saga Continues – What To Hold And What NOT To Hold In A TFSA Or ISA
John Richardson – July 4, 2026
On June 30, 2026 the Supreme Court Of The United States released it’s decision in Trump v. Barbara. The complete decision can be read here:
https://www.supremecourt.gov/opinions/25pdf/25-365_4hdj.pdf
A June 30, 2026 discussion (with initial impressions) is found in the Appendix to this post.
It starts with the 14th Amendment
The 14th Amendment of the U.S. constitution starts with the following language:
Section 1
All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.
The decision should be interpreted in a very minimal way as follows:
– Five justices (Roberts, Sotomayor, Kagan, Jackson and Barrett) interpreted the 14th Amendment (the words “and subject to the jurisdiction” notwithstanding) to mean that birth on U.S. soil is a sufficient condition for U.S. citizenship (the number of dissenting decisions means that there is a good chance that this issue will be revisited)
– Four justices (Thomas, Alito, Gorsuch and Kavanaugh) ruled that the 14th Amendment should NOT be interpreted to mean that birth on U.S. soil was a sufficient condition for U.S. citizenship
– Justice Alito in particular was very skeptical of those who were born in the USA but were also born as citizens of another country. Justice Alito begins his dissent with:
JUSTICE ALITO, dissenting.
This is one of the most important decisions in the history of the Court, and in my judgment, the Court has made a serious mistake. As interpreted by the Court today, the Fourteenth Amendment confers citizenship on virtually everyone who happens to be born in this country, including the children of “birth tourists,” women who come here solely for the purpose of giving birth to a child and then promptly return home. Careful analysis of the text of the Fourteenth Amendment and the process that led to its adoption shows that it does not degrade the concept of United States citizenship in this way. Instead, the Fourteenth Amendment confers citizenship on only those children who, at birth, owe allegiance solely to this country.
It is the inclusion of the words “owe allegiance solely to this country” with particular emphasis on the word “solely” that indicates the hostility toward “dual citizenship” at birth.
Yet, it is the combination of “birth on U.S. soil” coupled with being born as a citizen of another country that creates the most valuable form of U.S. citizenship!
America is taxation and taxation is America!
Yes, it’s the Internal Revenue Code that makes dual citizenship from birth so valuable. Under 877A(g)(1)(B)(i) an exemption to the Exit Tax rules is created for certain individuals who were born dual citizens. The specific text of the Internal Revenue Code which creates preferential treatment for dual citizens at birth is:
(i)the individual—
(I) became at birth a citizen of the United States and a citizen of another country and, as of the expatriation date, continues to be a citizen of, and is taxed as a resident of, such other country, and
(II) has been a resident of the United States (as defined in section 7701(b)(1)(A)(ii)) for not more than 10 taxable years during the 15-taxable year period ending with the taxable year during which the expatriation date occurs,
Those interested in a “deeper dive” might find this earlier post from this Citizenship Solutions blog interesting.
The narrow purpose of this post is to demonstrate that those who were born on U.S. soil as dual citizens from birth have a much higher standard of U.S. citizenship than those who were NOT born as dual citizens from birth. This is a shocking realization for a country that claims to have equality of citizenship. Because of the tax code, nothing could be further from the truth! The Internal Revenue Code generally (through complexity and exemptions) divides and conquers U.S. citizens. The United States is the only major country in the world that requires its citizens, who do NOT live in the country, to pay tax on their worldwide income to their country of citizenship.
In practical terms this means that:
– taxation is what distinguishes U.S. citizenship from other citizenships (If July 4 is considered to be a celebration of citizenship, then it should be considered to be a celebration of U.S. citizenship taxation);
– the only practical meaning of U.S. citizenship taxation is that the United States imposes direct taxation according to U.S. tax laws on (1) individuals who are tax residents of other countries and (2) on the non-U.S source income received by those individuals; and
– the United States imposes a more punitive form of taxation on U.S. citizens who live outside the United States than on U.S. citizens who live in the United States (PFIC, GILTI, Subpart F, phantom capital gains tax, FBAR, Form 8938, etc.)
(Incidentally those individuals are also subject to taxation in the countries where they reside.)
In short for U.S. citizens living outside the United States:
U.S. Citizenship = double taxation
A picture or chart is worth a thousand words
The following table will show why those “Born In The USA” and are ALSO born as citizens of another country are born as “preferred citizens”. Significantly they have both the right to NOT be stripped of U.S. citizenship AND the right to renounce U.S. citizenship without being subject to the 877A Exit Tax AND are not impacted by the 2801 “Covered Gift Tax” (meaning they are still permitted to make gifts and/or bequests to U.S. citizens.
Conclusion: The highest form of U.S. citizenship are U.S. citizens who were born with dual citizenship. Specifically those who (1) Became U.S. citizens by being “Born In The USA” and (2) were born as citizens of another country have a much higher standard of U.S. citizenship than any other level of U.S. citizenship. They cannot be stripped of their U.S. citizenship and they have the necessary condition required to expatriate without triggering the U.S.Internal Revenue Code 877A Exit tax or the U.S. Internal Revenue Code 2801 covered gift tax. This is the highest level of U.S. citizenship and is based ONLY on circumstances of birth.
The next level of U.S. citizenship is U.S. citizens born abroad to a U.S. citizen parent who were also born as citizens of another country – dual citizens from birth.
Bottom line: Dual citizenship from birth is extremely valuable. There is NO question that the citizens who Justice Alito finds the most objectionable are the ones who hold the highest level of U.S. citizenship!
Q. Is U.S. citizenship a “caste” system of citizenship?
A. Based on the definition of “caste” found here, it may very well be.
Significantly, what Justice Alito finds problematic (being born a citizen of another country) is precisely the most valuable form of U.S. citizenship.
Bottom line: Not all U.S. citizenship is the same!
________________________________________________________________
John Richardson – Follow me X at @Expatriationlaw
Appendix – Discussion of the Trump v. Barbara case on June 30, 2026
Introduction
Podcast 1 – July 2, 2026
Podcast 2 – July 17, 2026
On June 26, 2026 I did a presentation in London, UK titled “The Life And Times Of Mr. FBAR”. Obviously, the presentation included a discussion of how to file delinquent FBARs without triggering an FBAR penalty.
That discussion included references to both:
– “Streamlined filing procedures“; and
– “Delinquent FBAR submission procedures”
On June 30, 2026 the “Delinquent FBAR submission procedures” option was removed from the IRS site. It appears that this specific procedure is no longer an option. Notably, the “Delinquent FBAR submission procedures” option included the promise that:
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.
Purpose
The purpose of this post is to archive the 2011 IRS Fact Sheet for U.S. Citizens or Dual Citizens Living Outside the U.S.
The summer of 2011 was a particularly difficult time for U.S. citizens living outside the United States. Many of them were learning about U.S. citizenship taxation and FBAR for the first time. Many made the mistake of entering the IRS 2011 Offshore Voluntary Disclosure Program (“OVDI”).
Finally, in December of 2011 the IRS provided minimal direction on what Americans abroad were required to do.
I am in the middle of preparing a presentation on “The Life And Times Of Mr. FBAR” and have been considering “civil” FBAR penalties under 31 U.S.C. 5321. Specifically, what are the factors that the IRS considers in determing whether an FBAR violation is willful or non-willful. I remember this 2011 directive as including some interesting considerations. It taok me some time to track this down. Hence, I though I would write a short post to ensure that:
“Information for U.S. Citizens or Dual Citizens Residing Outside the U.S.
FS-2011-13, December 2011”
was stored on this site. Hence, this post.
Of particular interest are the following paragraphs:
“6. Possible penalties for failure to file FBAR
If you fail to file an FBAR, in the absence of reasonable cause, you may be subject to either a willful or non-willful civil penalty. Generally, the civil penalty for willfully failing to file an FBAR can be up to the greater of $100,000 or 50 percent of the total balance of the foreign account at the time of the violation. See 31 U.S.C. §5321(a)(5). Note that this penalty is applicable only in cases in which there is willful intent to avoid filing. Non-
willful violations that the IRS determines are not due to reasonable cause are subject to a penalty of up to $10,000 per violation. There is no penalty in the case of a violation that IRS determines was due to reasonable cause. For more information about the FBAR penalty, see Form TD F 90-22.1. For information about the reasonable cause exception to the FBAR penalty, see IRM 4.26.16, Report of Foreign Bank and Financial Accounts (FBAR).
Example 3: Same facts as Example 1, except that the highest balance in Taxpayer’s checking account exceeded $10,000 and, after reading recent press and thus learning of his FBAR filing obligations, Taxpayer filed an accurate, though late, FBAR. The FBAR was accompanied by a written statement explaining why Taxpayer believed the failure to file the FBAR was due to reasonable cause. The IRS will determine whether the violation was due to reasonable cause based on all the facts and circumstances. Taxpayer’s explanation for why he failed to timely file an FBAR appears reasonable in view of the facts and circumstances of the case. Since
the IRS determined that the FBAR violation was due to reasonable cause, no FBAR penalty will be asserted.
Factors that might weigh in favor of a determination that an FBAR violation was due to reasonable cause include reliance upon the advice of a professional tax advisor who was informed of the existence of the foreign financial account, that the unreported account was established for a legitimate purpose and there were no indications of efforts taken to intentionally conceal the reporting of income or assets, and that there was no tax
deficiency (or there was a tax deficiency but the amount was de minimis) related to the unreported foreign account. There may be factors in addition to those listed that weigh in favor of a determination that a violation was due to reasonable cause. No single factor is determinative.
Factors that might weigh against a determination that an FBAR violation was due to reasonable cause include whether the taxpayer’s background and education indicate that he should have known of the FBAR reporting requirements, whether there was a tax deficiency related to the unreported foreign account, and whether the taxpayer failed to disclose the existence of the account to the person preparing his tax return. As with factors that might weigh in favor of a determination that an FBAR violation was due to reasonable cause, there may be other factors that weigh against a determination that a violation was due to reasonable cause. No single factor is determinative.
Current IRS procedures state that an examiner may determine that the facts and circumstances of a particular case do not justify asserting a penalty and that instead an examiner should issue a warning letter. See IRM 4.26.16, Report of Foreign Bank and Financial Accounts (FBAR). The IRS has established penalty mitigation guidelines, but examiners may determine that a penalty is not appropriate or that a lesser (or greater) penalty amount than the guidelines would otherwise provide is appropriate. Examiners are instructed to consider whether compliance objectives would be achieved by issuance of a warning letter; whether the person whocommitted the violation had been previously issued a warning letter or has been assessed the FBAR penalty; the nature of the violation and the amounts involved; and the cooperation of the taxpayer during the examination.
Example 4: Taxpayer is a United States citizen who lives and works in Country B as a computer programmer. Taxpayer has checking and savings accounts with a bank that is located in the city where he lives. The aggregate balance of the checking and savings accounts is $50,000 during the tax year. Taxpayer complied with Country B’s tax laws and properly reported all his income on Country B tax returns. Taxpayer failed to file federal income tax returns and failed to file FBARs to report his financial interest in the checking and savings accounts. After reading recent press and thus learning of his federal income tax return and FBAR reporting obligations, Taxpayer filed delinquent FBARs, reporting both foreign accounts, and attached statements to the FBARs explaining that he was previously unaware of his obligation to report the accounts on an FBAR. Taxpayer also filed federal income tax returns properly reporting all income and no tax was due. The IRS will determine whether the FBAR violation was due to reasonable cause based on all the facts and circumstances. Taxpayer had a legitimate purpose for maintaining the foreign accounts, there were no indications of efforts taken to intentionally conceal the reporting of income or assets, and no tax was due. Taxpayer’s explanation for why he failed to timely file an FBAR appears reasonable in view of the facts and circumstances of the case.
Since the IRS determined that the FBAR violation was due to reasonable cause, no FBAR penalty will be asserted.”
You can read the FS-2011-13 in its entirety here:
It is also discussed here.
John Richardson – Follow me on X.com/Expatriationlaw