Form 14654 at a glance
What it is: Form 14654 is the Certification by U.S. Person Residing in the United States for Streamlined Domestic Offshore Procedures, from the Department of the Treasury - Internal Revenue Service.
Who signs: Under penalties of perjury, you declare that you have examined this certification and all accompanying schedules and statements, and to the best of your knowledge and belief, they are true, correct, and complete.
You are not required to apply for participation in the streamlined filing compliance program. If you choose to apply, however, you are required to provide all the information requested on the streamlined certification.
On Form 14654, the information will be used to determine and collect the correct amount of tax under the terms of the streamlined filing compliance program.
A filled-in Form 14654 example: a single taxpayer lists three years
How to fill out Form 14654, box by box
Name(s) of taxpayer(s) and mailing address
Enter the Name(s) of taxpayer(s), TIN(s) of taxpayer(s), Telephone number, Mailing address, City, State and ZIP code.
If this certification is a joint certification, the statements will be considered made on behalf of both spouses, even though the pronoun “I” is used. If spouses submitting a joint certification have different reasons for their failure to report all income, pay all tax, and submit all required information returns, including FBARs, they must state their individual reasons separately in the required statement of facts.
Certification: the tax and interest I owe for each year
Under Certification, I previously filed original tax returns for these years; list the Year in order, with the Amount of Tax I Owe Shown On Form 1040X, Interest and Total, for each of the most recent 3 years for which the U.S. tax return due date (or properly applied for extended due date) has passed.
Foreign financial assets subject to the 5% miscellaneous offshore penalty
For each Year in either your 3-year covered tax return period or your 6-year covered FBAR period, list the foreign financial assets subject to the 5% miscellaneous offshore penalty: Name, City, and Country of Financial Institution/Description of Asset, Account Number, Year Account Was Opened or Asset Was Acquired and Year-End Balance/ Asset Value.
If you held no assets subject to the 5% miscellaneous offshore penalty during a year, enter “N/A” next to “Total” in that year's table.
Attach a continuation sheet if necessary. If you attach a continuation sheet, it must be signed with taxpayer name(s) and TIN(s) printed.
My penalty computation and payment information
Under My penalty computation, enter the Highest Account Balance/Asset Value (the highest total balance/ asset value among the years listed), then the Miscellaneous Offshore Penalty (Highest Account Balance/Asset Value multiplied by 5%).
Under My payment information, enter the Total Tax and Interest Due, the Miscellaneous Offshore Penalty and the Total Payment. Your payment should equal the total tax and interest due for all three years, plus the miscellaneous offshore penalty.
You may receive a balance due notice or a refund if the tax, interest, or penalty is not calculated correctly.
The statement of facts
You must provide specific facts on this form or on a signed attachment explaining your failure to report all income, pay all tax, and submit all required information returns, including FBARs. Any submission that does not contain a narrative statement of facts will be considered incomplete and will not qualify for the streamlined penalty relief.
Include the whole story including favorable and unfavorable facts. Specific reasons, whether favorable or unfavorable to you, should include your personal background, financial background, and anything else you believe is relevant to your failure to report all income, pay all tax, and submit all required information returns, including FBARs. Explain the source of funds in all of your foreign financial accounts/assets, for example whether you inherited the account/asset, whether you opened it while residing in a foreign country, or whether you had a business reason to open or use it.
Explain your contacts with the account/asset including withdrawals, deposits, and investment/ management decisions. If you relied on a professional advisor, provide the name, address, and telephone number of the advisor and a summary of the advice.
If married taxpayers submitting a joint certification have different reasons, provide the individual reasons for each spouse separately in the statement of facts. The field will automatically expand to accommodate your statement of facts.
Signature of Taxpayer
Sign on the Signature of Taxpayer line, then enter the Name of Taxpayer and Date.
For a joint certification, the second taxpayer signs on the Signature of Taxpayer (if joint certification) line and enters the Name of Taxpayer (if joint certification) and Date.
For Estates Only
For Estates Only, sign on the Signature of Fiduciary line, then enter the Date, Title of Fiduciary (e.g., executor or administrator) and Name of Fiduciary.
For Paid Preparer Use Only
For Paid Preparer Use Only: the signature of taxpayer(s) or fiduciary is required even if this form is signed by a paid preparer. The preparer signs on the Signature of Preparer line and enters Name of Preparer, Date, Firm's name, Firm's EIN, Firm's address, City, State, ZIP code, Telephone number and PTIN, and check if Self-Employed.
Do you want to allow another person to discuss this form with the IRS
Check Yes to allow another person to discuss this form with the IRS and complete the Designee's name and Telephone number, or check No.
More rules for Form 14654
I failed to report income from one or more foreign financial assets during the period. I meet all the eligibility requirements for the Streamlined Domestic Offshore procedures. If I failed to timely file correct and complete FBARs for any of the last 6 years, I have now electronically filed those FBARs.
In consideration of the Internal Revenue Service's agreement not to assert other penalties with respect to my failure to report foreign financial assets as required on FBARs or Forms 8938 or my failure to report income from foreign financial assets, I consent to the immediate assessment and collection of a Title 26 miscellaneous offshore penalty for the most recent of the three tax years for which I am providing amended income tax returns. I waive all defenses against and restrictions on the assessment and collection of the miscellaneous offshore penalty, including any defense based on the expiration of the period of limitations on assessment or collection. I waive the right to seek a refund or abatement of the miscellaneous offshore penalty.
I agree to retain all records (including, but not limited to, account statements) related to my assets subject to the 5% miscellaneous offshore penalty until six years from the date of this certification. I also agree to retain all records related to my income and assets during the period covered by my amended income tax returns until three years from the date of this certification. Upon request, I agree to provide all such records to the Internal Revenue Service.
My failure to report all income, pay all tax, and submit all required information returns, including FBARs, was due to non-willful conduct. I understand that non-willful conduct is conduct that is due to negligence, inadvertence, or mistake or conduct that is the result of a good faith misunderstanding of the requirements of the law.
The time needed to complete and submit the streamlined certification will vary depending on individual circumstances. The estimated average time is: 8 hours.
Common questions about Form 14654
Is there a penalty?
Yes. The Miscellaneous Offshore Penalty is the Highest Account Balance/Asset Value (the highest total balance/ asset value among the years listed) multiplied by 5%. If the Internal Revenue Service receives or discovers evidence of willfulness, fraud, or criminal conduct, it may open an examination or investigation that could lead to civil fraud penalties, FBAR penalties, information return penalties, or even referral to Criminal Investigation. Providing false information may subject you to penalties.
Sources
[1] Form 14654 (Rev. 9-2017), Certification by U.S. Person Residing in the United States for Streamlined Domestic Offshore Procedures, Department of the Treasury - Internal Revenue Service (the Official source link on this page).