SDOP Services for US Taxpayers With Unreported Foreign Assets
Get professional help reviewing your filing history, foreign reporting requirements and SDOP submission before deciding on the next step.
For taxpayers living in the United States whose filed returns left out foreign income, accounts or investments.
- 3 covered years of amended returns
- 6 covered years of FBARs
- Form 14654 certification
- Penalty base reviewed asset by asset
The returns went in. The foreign side did not.
- 01
Returns were filed, foreign income was not
Interest on an Indian savings, NRO or fixed-deposit account never reached Schedule B.
- 02
Foreign accounts crossed the FBAR threshold
Together they exceeded $10,000 at some point in a year, and FinCEN Form 114 was never filed.
- 03
Investments need a reporting review
A foreign mutual fund, brokerage account or shareholding may have required Form 8938, 8621 or 5471.
- 04
Unsure which assets affect the penalty
Property, funds and accounts are treated differently in the IRS penalty base.
Each is a reason for a review, not proof of eligibility: all six conditions below still have to hold.
Six conditions. All of them have to hold.
The IRS sets them; nothing on this page determines them for you. The first rules out the most cases: a missing return for any covered year means SDOP is not the route. IRS eligibility page
- 1
Returns filed for all three covered years
Delinquent original returns cannot be filed under SDOP.
- 2
Fails the foreign non-residency test
A US abode, or fewer than 330 full days abroad, in each of the three years.
- 3
Non-willful conduct
Negligence, inadvertence, mistake or a good-faith misunderstanding of the law.
- 4
Unreported foreign income
Income from a foreign financial asset was left off a return; FBARs or information returns may be missing too.
- 5
No open IRS examination
A civil examination of any year, or a criminal investigation, rules the procedures out.
- 6
A valid Social Security number
Without one the submission loses the favourable penalty terms.
Organise the facts before you talk to us
Seven questions, no identifiers. The result is what a professional would review first.
Your answers stay in your browser. Nothing is stored or sent unless you choose to include a summary with the case-review form.
SDOP or SFOP?
Where you lived during the covered years decides it, and the 5% penalty follows from that.
| Attribute | SDOPThis page | SFOP |
|---|---|---|
| Who it is for | Fails the non-residency test (lives in the US) | Meets the non-residency test (lives abroad) |
| Tax returns | 3 covered years, amended only | 3 covered years, delinquent or amended |
| FBARs | 6 covered years | 6 covered years |
| Certification | Form 14654 | Form 14653 |
| Offshore penalty | 5% of the IRS penalty base | None, if eligible and compliant |
| Tax and interest | Payable | Payable |
Three years of returns, six years of FBARs
The two windows are set by the IRS and move with the calendar. Everything in them goes into one submission.
The three most recent tax years whose due date (including extensions) has passed are amended on Form 1040-X. The six most recent FBAR years are filed electronically with FinCEN. The window moves each time a due date passes, so we confirm the calendar years on the day we scope your case.
Five percent of what, exactly?
The miscellaneous offshore penalty is 5% of the highest aggregate year-end value of the assets that are subject to it. It is not 5% of everything you own abroad, and a balance multiplied by five percent is not a substitute for the IRS method. Deciding which assets count, and in which years, is the work.
- 6 FBAR yearsForeign financial accounts that should have been on an FBAR that year, but were not.
- 3 return yearsForeign financial assets that should have been on Form 8938 that year, but were not.
- 3 return yearsAssets that were on Form 8938, but whose income was not reported that year.
For each year the year-end values of those assets are added together. A year that was fully compliant enters as zero. The highest annual total is the base, and the penalty is 5% of it.
IRS SDOP FAQs: penalty base, valuation, spouses- counted at year-end value
- compliant or not held that year: zero
- never in the base
What stays out
- A flat or land you hold directly: not reportable on FBAR or Form 8938, so outside the base even though the rent is still taxed
- Accounts where you only had signature authority and no financial interest
- For a wholly owned foreign company, the company's bank accounts: the IRS measures the shares instead, unless the entity is disregarded
Four separate amounts
The penalty is one line, not the whole bill. Three go to the IRS with the submission; one is ours.
- To the IRSTaxOn the three amended returns, after foreign tax credit
- To the IRSInterestStatutory, from each original due date
- To the IRS5% penaltyOn the IRS penalty base, paid with the submission
- To SavetaxsProfessional feeSavetaxs' fee, quoted after scoping
One package, prepared and checked before you sign
Every SDOP engagement produces the same core package. Work that depends on your assets is scoped after the review and listed in the estimate, never assumed.
- 01
Filing and foreign income review
Three covered years checked for omitted foreign income; six FBAR years checked for unreported accounts.
- 02
Amended returns and FBARs
Form 1040-X with corrected schedules for each covered year; FinCEN Form 114 for each FBAR year, prepared for e-filing.
- 03
Information returns
Form 8938 where the thresholds apply. Funds, companies and trusts are scoped separately.
- 04
Form 14654 and certification
The narrative statement of facts drafted from your account of events; the penalty worksheet completed.
- 05
Penalty-base and tax review
Assets classified year by year; the tax and interest to remit checked against the returns.
- 06
Quality control and sign-off
Second-preparer review, then a submission checklist for the paper filing and the FBAR e-filing.
Scoped after review
Added only when your assets call for it. Not included: representation in an IRS examination and work on years outside the covered periods.
- Form 8621 for foreign mutual funds and other PFICsOne computation per fund, per year
- Forms 5471, 5472 or 8865 for foreign companies and partnershipsEntity financials and ownership history
- Forms 3520 and 3520-A for gifts, inheritances and trustsDepends on amounts and the arrangement
- Valuation of unlisted sharesThe penalty base needs a year-end value
- State amended returnsOnly where the state taxes the omitted income
Want the scope confirmed for your assets?
An outline of your accounts and investments is enough for us to list the forms involved and send a written estimate.
Five stages, with your sign-off before anything is sent
You see every figure, the penalty worksheet and the narrative before you sign Form 14654.
- 1
Initial case inquiry
Where you live, which years were filed, what you think was missed. No identifiers.
- 2
Filing-history and eligibility review
The three-year filing record and the non-residency position are confirmed before anything is prepared.
- 3
Document collection
A checklist built around your assets; statements shared through your Savetaxs client dashboard.
- 4
Preparation and professional review
Amended returns, FBARs, information returns, the penalty worksheet and Form 14654, checked by a second preparer.
- 5
Sign-off and submission
You approve every figure and the narrative, sign the originals, then file on paper to the IRS and e-file the FBARs with FinCEN.
What to gather
Not needed to ask for a review; it is the list we work from once the scope is agreed.
No Social Security numbers, ITINs, passport or account numbers through the web form. Statements are shared through your Savetaxs client dashboard once the scope is agreed.
- US filing historyThe three most recent returns as filed · Any IRS correspondence
- Foreign accounts and assetsStatements for the six FBAR years · Year-end balances and values, each year
- Foreign income and taxInterest, dividend, rent and gains by year · Indian returns and Form 26AS or AIS
- The story behind the omissionsHow each account or asset was opened or received · Who prepared earlier returns and what they asked
Ready to start with an outline?
Tell us where you live, which years were filed and what was missed. We reply by email with next steps.
What moves the fee, and who checks the work
Savetaxs does not publish a flat price for streamlined work: the gap between a three-account case and a multi-entity case is too wide to be honest about in one number. You get a written estimate before anything starts.
- Filing history
- Clean, timely returns are quicker to amend than late or inconsistent ones.
- Number and type of assets
- Three bank accounts is one piece of work; eight accounts, two funds and a shareholding are several.
- Information returns
- Forms 8621, 5471 and 3520 each add preparation time and are quoted separately.
- Corrections to earlier reporting
- Schedules that were wrong have to be rebuilt, not added to.
- Valuation work
- Unlisted shares and property-holding entities need a defensible year-end value.
- Country of residence and US tax status
- Whether a return exists for each of the last three years
- A rough count of foreign accounts and assets
- Whether funds, companies, gifts or inheritances are involved
IRS amounts (tax, interest, any offshore penalty) are separate from our fee and are paid to the IRS.
SDOP packages are prepared by Savetaxs’ tax team and checked under its CA + CPA review process before you sign. Where Indian accounts, funds or property are involved, a chartered accountant reconciles the Indian-side figures, including tax already paid that may qualify for foreign tax credit.
CPAHatim Dudhiyawala
US Certified Public Accountant · Delhi NCR
CAAnoop Ranta
Chartered Accountant · Delhi NCR
CAVaibhav Jain
Chartered Accountant · Jaipur
A network of chartered accountants and US CPAs, not an in-house team. Rating from Savetaxs internal records. Client reviews · Expert directory
Insights on SDOP & Offshore Compliance
Guides on the Streamlined Domestic Offshore Procedures, late FBARs and getting back into U.S. tax compliance.
Before you start an SDOP submission
The questions that come up in SDOP case reviews, answered from the IRS guidance.
Streamlined Domestic Offshore Procedures (SDOP) are an IRS compliance program for eligible U.S. taxpayers residing in the United States who failed to report foreign income or meet certain foreign asset reporting requirements due to non-willful conduct. The program allows eligible taxpayers to correct past filing deficiencies by submitting amended tax returns, required FBARs and a non-willfulness certification.
SDOP is generally intended for eligible individual taxpayers and estates of individual taxpayers residing in the United States who do not meet the applicable non-residency requirements for SFOP. Applicants must satisfy the IRS filing and non-willfulness conditions. Eligibility depends on their filing history, foreign financial activities and individual circumstances.
SDOP generally requires a 5% miscellaneous offshore penalty calculated on the applicable highest aggregate year-end value of the relevant foreign financial assets during the covered period. The calculation follows specific IRS rules and is not simply 5% of your current overseas bank balance or all foreign assets.
Generally, SDOP requires applicants to have previously filed the required original U.S. tax returns for each of the relevant three covered tax years. If you have never filed required original returns, SDOP may not be the appropriate procedure. Your circumstances should be reviewed to identify the applicable IRS compliance option.
The primary difference is the taxpayer's residency status. SDOP is generally for eligible taxpayers residing in the United States who do not meet the applicable SFOP non-residency test. SFOP is for eligible taxpayers who meet that non-residency test. SDOP generally involves a 5% miscellaneous offshore penalty, whereas SFOP does not impose this penalty under its streamlined terms.
Eligibility may be restricted if the IRS has initiated a civil examination of your returns for any taxable year or if you are under criminal investigation by IRS Criminal Investigation. If you have received an IRS notice, do not assume you qualify or are disqualified without reviewing the nature of the notice and your circumstances.