I received a letter from non-U.S. bank asking to verify the tax status of my account
Here is an example of such letter received by one of our clients in Switzerland:
If you are not currently compliant, the approach we recommend is the following:
- Respond to the bank immediately and tell them you are in the process of filing. Ask to set up a timeline within which you will provide proof of compliance. Banks will normally give you a span of 30 to 45 days to file. They don’t want to lose a client but they will want to see that you are not simply ignoring them.
- Contact a professional U.S. expat tax preparation company to take care of this for you (many people think that we’re pretty good at it). If you were not working against the clock you might try to do it on your own, but this is not something we’d advise if your bank is already on your case. You want to have this done quickly and accurately.
If you were to come to us, we would likely recommend that you take advantage of the Streamlined Filing Procedure. Through this program, you’ll be able to become fully compliant with the IRS without risk of penalties. Joining it requires that you complete and file tax returns for the past 3 years and FBARs for the past 6 years. See total cost here. The normal processing time is about a month, giving you enough time to report back to your bank.