Can I use the Streamlined Foreign Offshore procedure if I lived in the US for two of the three years?

Yes, if you are otherwise eligible. The IRS non-residency requirement is met where, in any one or more of the most recent three years for which the return due date has passed, you had no US abode and were physically outside the United States for at least 330 full days. One qualifying year is enough, and you then file for all three years in the window, including the US-resident ones.

Is there a penalty under the Streamlined Foreign Offshore Procedures?

No. The IRS states that a taxpayer who complies with the foreign procedure will not be subject to failure-to-file, failure-to-pay, accuracy-related, information return or FBAR penalties. Tax and interest for the three years must still be paid. The 5% miscellaneous offshore penalty belongs to the Streamlined Domestic Offshore Procedures only, which apply where the non-residency requirement is not met.

Do I file amended or delinquent returns for the years I lived in the US?

Usually amended. Most people filed Form 1040 on time while living in the US but left out UK accounts, UK rental income or UK investments. Those years are corrected on Form 1040-X with the missing income, foreign tax credits and information returns. The foreign procedure accepts delinquent or amended returns, so the package can contain either.

How many FBARs do I need to file if I only moved to the UK recently?

Six years, covering the most recent six years for which the FBAR due date has passed. For a recent mover most of those are years of US residence. FinCEN requires an FBAR from any US person whose foreign financial accounts exceeded $10,000 in aggregate at any time in the calendar year, wherever that person was living, so UK accounts held from a US address were reportable.

Does UK split-year treatment change my US filing position?

No. Split-year treatment under the UK statutory residence test divides a UK tax year into an overseas part and a UK part for UK tax purposes only. A US citizen or green card holder stays taxable in the US on worldwide income for the full calendar year of the move. It does affect how much UK tax is paid, and therefore the foreign tax credits available on the US return.

Can a Briton returning from the US claim the UK foreign income and gains regime?

Only if they were non-UK resident for at least 10 consecutive tax years before returning. HMRC's guidance makes the regime available for the first four tax years of UK residence after that period, with claims made on the Self Assessment return. A shorter US career does not qualify. For a US citizen the relief removes UK tax only; the income remains taxable in the US.

Streamlined Foreign Offshore After Years Lived in the US

The Streamlined Foreign Offshore procedure can cover tax years in which you were living in the United States, because the IRS non-residency test only has to be met in one of the three years in the filing window. If you have recently moved from the US to the UK and your American-era returns left out UK bank accounts, UK rental income or a UK investment portfolio, that single qualifying year abroad can bring the whole three-year period under the foreign procedure, which carries no penalty. The alternative, the Streamlined Domestic Offshore Procedures, carries a 5% penalty measured on the value of your foreign financial assets.

This matters most to two kinds of reader: the Briton who spent a career in New York or San Francisco, took a green card or US citizenship along the way, kept UK accounts and perhaps a let property in London throughout, and has now come home; and the American banker, investor or business owner who has relocated to London and discovered that foreign accounts held during the US years were never reported. Both tend to assume that a problem which arose while living in America must be fixed through the domestic procedure. That assumption is often wrong, and expensive.

Can Streamlined Foreign Offshore cover years when you lived in the US?

Yes. The IRS page at https://www.irs.gov/individuals/international-taxpayers/us-taxpayers-residing-outside-the-united-states sets out the rule. A US citizen or lawful permanent resident meets the non-residency requirement if, in any one or more of the most recent three years for which the US tax return due date (or properly applied for extended due date) has passed, the individual did not have a US abode and was physically outside the United States for at least 330 full days. The words that matter to a recent mover are any one or more. The test is not applied year by year to decide which returns are allowed in. It is applied once, to decide whether the person is eligible, and an eligible person then files for all three years in the window.

The same IRS page describes what an eligible taxpayer submits: delinquent or amended returns, with all required information returns, for each of the most recent three years for which the due date has passed, and FBARs for each of the most recent six years for which the FBAR due date has passed. Nothing in that wording restricts the three returns to years spent abroad. Two Manhattan years and one London year qualify, provided the London year meets the test.

A short definition helps. The Streamlined Foreign Offshore Procedures are an IRS compliance route for US taxpayers living outside the United States whose failure to report foreign income and foreign financial assets was non-wilful. The parent page at https://www.irs.gov/individuals/international-taxpayers/streamlined-filing-compliance-procedures defines non-wilful conduct as conduct due to negligence, inadvertence or mistake, or a good faith misunderstanding of the law, and confirms that a taxpayer already under IRS civil examination for any year cannot use the procedures.

How is the non-residency test applied to someone who has only just left?

The certification form shows how the IRS expects to see it. Form 14653 at https://www.irs.gov/pub/irs-pdf/f14653.pdf contains a small table in which a citizen or green card holder lists each of the three years and answers yes or no to whether they were physically outside the United States for at least 330 full days. For a recent mover the honest answers are no, no, yes. That pattern is not a defect in the submission. The form itself repeats that the requirement is met in any one or more of the three years. What matters is whether the yes is true.

We have covered counting the 330 days and the abode test in separate articles, so only the recent-move points belong here. The count is of full days outside the United States within the year concerned, so a mid-year move almost never produces a qualifying year in the year of the move. For most people the first qualifying year is the first complete calendar year lived in the UK, provided no US home was kept available.

Couples need particular care. Where spouses file a joint certification, the form states that both must meet the non-residency requirement and that differing day counts must be disclosed. If one spouse moved to London in the spring and the other stayed in Connecticut until the school year ended, their first qualifying years may differ.

Why does the foreign route matter so much compared with the domestic one?

A taxpayer who cannot meet the non-residency requirement is left with the Streamlined Domestic Offshore Procedures, described at https://www.irs.gov/individuals/international-taxpayers/us-taxpayers-residing-in-the-united-states on the IRS website. That route is open only to someone who has previously filed a US return for each of the most recent three years, and it carries the miscellaneous offshore penalty: 5% of the highest aggregate balance or value of the taxpayer's foreign financial assets that are subject to the penalty during the covered tax return period and the covered FBAR period. The foreign route has no equivalent charge. The IRS states that a taxpayer who complies with the foreign procedure will not be subject to failure-to-file and failure-to-pay penalties, accuracy-related penalties, information return penalties or FBAR penalties.

Side by side, the two routes compare as follows.

Penalty: none under the foreign procedure; 5% of the highest aggregate value of the relevant foreign financial assets under the domestic procedure.
Returns accepted: delinquent or amended returns under the foreign procedure; amended returns only under the domestic procedure, because prior filing for all three years is a condition of entry.
Certification: Form 14653 for the foreign procedure; Form 14654 for the domestic procedure. Both require a narrative statement of facts.
Common to both: all tax and interest for the three years must be paid, six years of FBARs are filed, conduct must be non-wilful, and the returns can still be selected for examination in the ordinary way.

For a wealthy taxpayer the gap is rarely about the tax. Unreported UK interest, dividends and rent have usually borne UK tax already, and once foreign tax credits are claimed the additional US tax is often modest. The domestic penalty is different in kind because it is measured on the value of the assets. A seven-figure UK portfolio produces a five- or six-figure penalty even where the extra US tax is small.

Why does the package contain amended returns and not late ones?

Most streamlined foreign cases we prepare for long-term expatriates are built from delinquent returns, because nothing was ever filed. The recent mover is the opposite. During the US years a Form 1040 went in every year, reporting the salary, the bonus and the US brokerage account accurately. What was missing was everything on the other side of the Atlantic. The repair is an amended return, Form 1040-X, for each US-resident year in the window, and the IRS wording expressly allows amended returns within the foreign procedure.

In the returns we prepare for US-resident years, the amendments typically add the following: interest and dividends from UK accounts; rental income from a UK property, with a foreign tax credit for the UK tax paid on it; gains on UK investments; a corrected Schedule B, which asks each year whether the taxpayer had an interest in a foreign account; Form 8938 where the asset values required it, noting that the reporting thresholds are lower for a taxpayer living in the US than for one living abroad, as the IRS explains at https://www.irs.gov/forms-pubs/about-form-8938 in the form instructions; and Form 8621 for UK-domiciled funds, which are generally treated as passive foreign investment companies. A stocks and shares ISA is tax-free in the UK but has no special status on a US return.

Form 14653 also contains a certification aimed at amended returns. The taxpayer acknowledges that the amended returns may report income for years beyond the normal three-year assessment period, and that seeking a refund of that tax or interest as paid out of time forfeits the favourable terms of the procedure. Each return is marked Streamlined Foreign Offshore in red at the top, the package is filed on paper, and the tax and interest are paid with it.

When does the first qualifying year start to count, and what is the risk of waiting?

The three-year window rolls forward each time a return due date passes. Take someone who moved to London in the summer of 2025. Calendar 2025 is not a qualifying year, because half of it was spent in the US. Calendar 2026 can be. But the 2026 year does not enter the window until the due date for the 2026 return has passed, which happens in 2027. Until then every year in the window fails the test, and the only streamlined route open is the domestic one with its 5% penalty. Once the 2026 due date passes, the window becomes 2024, 2025 and 2026, and the foreign procedure opens.

The bracketed words in the IRS test, or properly applied for extended due date, have a practical consequence that is often missed. On a natural reading of that wording, if an extension is applied for in respect of the qualifying year, that year's due date has not passed until the extended date arrives, so an extension requested out of habit can delay eligibility by months. We check the extension position for the qualifying year before anything else is scheduled.

Waiting for the window to roll is a decision with real exposure attached, and it belongs to the taxpayer. Our role is to set out the dates and the figures. The risks of waiting are these.

An IRS examination of any year, on any subject, closes both streamlined procedures. A notice arriving during the waiting period removes the choice altogether.
Knowledge changes the character of what follows. Once you know the foreign accounts are reportable, every return and FBAR that falls due in the meantime has to be complete. Filing another return that omits them is no longer a mistake.
The delay itself has to be explained. The Form 14653 narrative asks for the whole story, and a long unexplained gap between discovering the problem and correcting it is an unfavourable fact that must be stated.
The procedures are an administrative programme, not a statutory entitlement. The IRS withdrew its separate web page on delinquent FBAR submissions in 2026, a reminder that published routes can change.

How far back do the FBARs reach into the US-resident years?

Further than the returns. FinCEN states at https://www.fincen.gov/report-foreign-bank-and-financial-accounts that a United States person with a financial interest in, or signature authority over, foreign financial accounts must file an FBAR if the aggregate value of those accounts exceeds $10,000 at any time during the calendar year. The report is due on 15 April with an automatic extension to 15 October and is filed electronically through the BSA E-Filing System. A UK current account, a savings account, an ISA, a UK brokerage account and an account over which you merely hold signing authority were all reportable from a Manhattan address.

Because the procedure asks for six years of FBARs, a recent mover will find that most of the six are years of US residence. Each report needs the maximum value of each account during the year, which means six years of UK bank statements, including closed accounts and joint accounts held with a UK spouse or parent. We ask for these first, because older statements take time to obtain.

What does the Form 14653 narrative have to explain about conduct while living in the US?

This is the hardest part of a recent-mover case. Form 14653 requires specific reasons for the failure to report all income, pay all tax and submit all required information returns, including FBARs. It asks for the whole story, including favourable and unfavourable facts, and says those reasons should include personal background, financial background and anything else relevant. It asks for the source of funds in every foreign account, whether the account was opened while residing in a foreign country or for a business reason, and for the taxpayer's contacts with the account, including withdrawals, deposits and investment and management decisions. If the taxpayer relied on a professional, the form asks for that person's name, address and telephone number and a summary of what they said. A submission without a narrative is treated as incomplete and does not qualify for penalty relief.

A lifelong expatriate can truthfully say that they did not know the United States taxed its citizens abroad. Someone who filed Form 1040 from a US address every year cannot say that. They were inside the system, with a preparer, answering a return that contains a direct question about foreign accounts. The narrative therefore has to deal with harder questions: what the preparer's annual questionnaire asked and how it was answered; whether the UK accounts were ever mentioned; whether money moved between the UK and US accounts; and how actively the UK accounts were used and managed during those years.

The facts that genuinely explain these cases tend to be ordinary: the accounts were opened long before the move to America and funded from UK earnings; the income was taxed in the UK and the taxpayer believed that settled it; the US preparer worked from a W-2 and a brokerage statement and asked about nothing else. The unfavourable facts have to appear too. A career in investment banking is a financial background the form expressly asks for. Where the facts point towards wilfulness, the IRS itself directs taxpayers to its Criminal Investigation Voluntary Disclosure Practice.

What about US state returns for the years you lived there?

The streamlined procedures are federal and do not bind any state. Yet income added to a federal return for a year in which you were resident in a state with an income tax will generally need to be reported to that state too, through an amended state return. States have their own notification rules, interest and penalties. The year of the move usually calls for a part-year resident return as well. We scope the state position alongside the federal amendments so that no loose end is left.

What is happening on the UK side in the year of arrival?

UK residence is decided under the statutory residence test for each tax year running from 6 April to 5 April. HMRC's guidance note RDR3 at https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt/guidance-note-for-statutory-residence-test-srt-rdr3 explains that a person who is UK resident for a tax year may have that year split into an overseas part and a UK part, and that for an arrival the cases to consider are split-year Cases 4 to 8. Each case has its own conditions and all of them must be met. Split-year treatment is a UK concept only. It does not shorten the US tax year, and a US citizen or green card holder remains taxable in the US on worldwide income for the whole calendar year of the move. The two countries also measure different twelve-month periods, so UK tax paid has to be matched to the right US year.

The UK's foreign income and gains regime for new arrivals needs equal care. HMRC's page at https://www.gov.uk/guidance/check-if-you-can-claim-the-4-year-foreign-income-and-gains-regime and its manual at https://www.gov.uk/hmrc-internal-manuals/residence-and-fig-regime-manual/rfig41000 explain that the regime, which began on 6 April 2025, is available to individuals who come to the UK after at least 10 consecutive tax years of non-UK residence, for their first four tax years of UK residence. Claims are made on the Self Assessment return, source by source, and the manual page at https://www.gov.uk/hmrc-internal-manuals/residence-and-fig-regime-manual/rfig43000 confirms that a claim costs the personal allowance and the capital gains annual exempt amount for that year. A split year counts as a full year of the four.

Three consequences follow for our reader. A Briton who was away for fewer than ten consecutive UK tax years will not qualify at all. An American arriving for the first time may qualify, but the relief removes UK tax only; the US still taxes that income, and with no UK tax paid on it there is no UK credit to set against the US liability. And the UK accounts and UK rental property that caused the US problem are not foreign for UK purposes, so they remain fully within UK tax.

What does this look like for a banker returning from New York to London?

The following is an illustration with assumed facts and round figures, not a client case. James is a dual US and UK national. He moved from London to New York in 2014, worked there as an investment banker, and moved back to London on 20 July 2025. Throughout his US years he kept UK bank accounts and a UK investment portfolio, and let his London flat. His US returns were filed on time each year and reported his American income in full. They did not report the UK interest, dividends or rent, and no FBAR was ever filed. Assume the highest aggregate value of his UK financial accounts across the relevant years was $4,000,000.

James discovers the problem in the autumn of 2026. At that point, with no extension running, the three most recent years with a passed due date are 2023, 2024 and 2025. In 2025 he was outside the United States for only about 160 full days, so none of the three meets the test. If he files now, the route is the domestic procedure: amended returns for the three years, six FBARs, tax and interest, and a miscellaneous offshore penalty of 5% of $4,000,000, which is $200,000.

Calendar 2026 is different. James has lived in London all year, his New York lease ended when he left, and he expects to spend around 20 days in the US on business, leaving roughly 345 full days outside. On those facts 2026 is a qualifying year. Once the due date for his 2026 return has passed in 2027, and provided he has not extended it, his window becomes 2024, 2025 and 2026. He is then eligible for the foreign procedure: an amended return for 2024, a full New York year; an amended return for 2025, the year of the move, with a part-year New York state position alongside it; the 2026 year, his first as a UK resident, filed complete; six FBARs, most of them for years he lived in Manhattan; Form 14653; and tax and interest. The penalty is nil. The difference between the two routes, on these assumed figures, is $200,000.

In the meantime James cannot stand still. His 2026 return and 2026 FBAR must be complete, because he now knows what is reportable. His narrative will have to explain why a banker with a US preparer answered the foreign account question incorrectly for a decade. On the UK side, having been non-UK resident for at least ten consecutive tax years on these assumed facts, he may be a qualifying new resident for the foreign income and gains regime from the 2025-26 tax year, which would relieve his US brokerage income from UK tax while leaving his UK rent fully taxable in the UK.

Where do these cases go wrong?

The failure modes we see most often in recent-mover files are consistent.

Filing under the domestic procedure and paying the 5% penalty a few months before the foreign procedure would have opened, because nobody checked the dates.
Claiming a qualifying year that does not survive scrutiny: a US home still available, a family still in the US, or day counts that include travel days as full days abroad.
Extending the qualifying year's return and submitting before the extended due date has passed.
A boilerplate narrative that says the taxpayer was unaware of the rules and never addresses the Schedule B question or the US preparer's questionnaires.
Amending the federal returns and ignoring the state.
FBARs that cover only the UK years, or that omit closed accounts and accounts held with signature authority only.

Each of these is avoidable with preparation in the right order: fix the qualifying year and its due date first, gather six years of UK statements second, reconstruct the US-year filing history third, and only then draft the returns and the certification. Our work is the preparation and filing of those returns, the FBARs and the certification, on the UK side as well as the US side, so that both sets of filings tell the same story.