Delinquent FBAR submission procedures: filing late FBARs with a reasonable cause explanation

What happened to the IRS procedures page

For years the IRS kept a separate page called the Delinquent FBAR Submission Procedures. That page no longer loads: its address on irs.gov returned page not found when checked on October 30, 2026. The IRS page listing the options for taxpayers with undisclosed foreign financial assets (reviewed June 30, 2026) now names three: the IRS Criminal Investigation Voluntary Disclosure Practice, the Streamlined Filing Compliance Procedures, and the delinquent international information return submission procedures. A separate FBAR procedure is not on the list.

Older IRS material still refers to it. The Form 14457 instructions (Rev. 7-2025) tell a taxpayer, “If you reported all income and paid all tax but failed to file FBARs, consider the delinquent FBAR submission procedures,” with a link to the retired address, and IRM 20.1.9.24.2 lists the procedures among the offshore options with the warning: “The Delinquent FBAR Submission Procedures and the Streamlined Filing Compliance Procedures may be discontinued at any time.”

What remains is the instruction on the IRS FBAR page (reviewed July 30, 2026), under “Filing delinquent FBARs”: “If the IRS hasn’t contacted you about a late FBAR and you’re not under civil or criminal investigation by the IRS, you should file late FBARs as soon as possible to keep potential penalties to a minimum.” The page sends filers to FinCEN’s filing-late instructions to explain the reason, and to the instructions for a specific compliance option if one is being used. What is gone is a published IRS page setting out terms specific to late FBARs.

Which route fits which client

The dividing line is income. If any income from the accounts was left off a return, the case is an amended-return case for tax, and the late FBAR is only one part of it.

Filing a late FBAR step by step

1. Decide which years were required. IRM 4.26.16.3.11 says delinquent FBARs “should be filed using the current electronic report but using the instructions for the year for which foreign accounts are being reported to determine if FBAR reporting requirements exist.” The test is the familiar one on the IRS FBAR page: a U.S. person with a financial interest in or signature or other authority over foreign financial accounts whose aggregate value exceeded $10,000 at any time during the calendar year.
2. Decide how far back to go. The IRS gives no fixed number of years for this route. The civil penalty period is a guide: 31 USC 5321(b)(1) allows assessment “at any time before the end of the 6-year period beginning on the date of the transaction,” and IRM 4.26.17.3.1.1 says “For report filing violations purposes, the date of the transaction is the due date of the FBAR.” The streamlined procedures use the six most recent years for which the FBAR due date has passed.
3. Gather the account data. For each account: the name on the account, account number, the institution’s name and address, the type of account and the maximum value during the year, which are also the records the IRS FBAR page says must be kept for five years.
4. File one FinCEN Form 114 per year on the BSA E-Filing System. FS-2022-24 says the system “allows them to enter the calendar year they're reporting, including past years.” The IRS will not accept a printed Form 114; paper filing requires an exemption from FinCEN.
5. On the cover page, select the late-filing reason. FinCEN’s instructions: “If one of the provided selections does not explain the reason, select “other” and provide a written explanation in the text box provided.” The reasons and the text box are covered below.
6. If someone else files, keep a FinCEN Report 114a. The IRS FBAR page says the 114a authorizes another person to e-file and is kept for the records, not submitted.
7. Keep the receipt and a copy. Each report gets a BSA Identifier in FinCEN’s acknowledgment; IRM 4.26.16.3.11 says “A copy of the FBAR should be kept for recordkeeping purposes.” The BSA ID is needed if the report is amended later.

There is no cover letter: the late-filing reason is the statement

A frequent question is what to put in the cover letter for a delinquent FBAR. There is nowhere to send one. The IRS FBAR page says “You must file the FBAR electronically through FinCEN’s BSA E-Filing System” and “You don’t file the FBAR with your federal tax return.” The explanation lives on the report itself. IRM 4.26.16.3.11: “Page one of FinCEN Form 114 should detail the reason the FBAR was not filed timely and a reason selected from the drop-down box. The "Other" selection allows for a 750-character text box explanation.”

That box is the whole reasonable cause submission unless the IRS later examines the FBARs. A longer memo can be kept in the file to support the explanation if questions come, but the IRS sees only what is on the report.

The late-filing reasons on the form

FinCEN’s FBAR XML Schema User Guide (1.4, August 2021) lists the late-filing reason codes the e-filed report carries. The descriptions are FinCEN’s; the notes are ours.

Three situations call for “Other” with specific text:

• Streamlined procedures. The streamlined domestic offshore page: “On the cover page of the electronic form, select “Other” as the reason for filing late. An explanation box will appear. In the explanation box, enter “Streamlined Filing Compliance Procedures.””
• A FinCEN filing waiver. FinCEN says to check “other” and identify the waiver by number, such as the FinCEN notice, in the text field.
• Any reason the list does not cover, or a list reason that needs context to show reasonable cause. A bare code is a reason, not an explanation.

The 750-character limit is on the online form (Publication 5569 and IRM 4.26.16.3.11). Software that batch-files FBARs in XML sends the narrative in an element that accepts 1 to 4,000 characters under the XML guide, but an explanation written to fit 750 works in both.

Writing the 750-character explanation

The standard is reasonable cause. IRM 4.26.16.5.4 notes that a few courts have applied the Title 26 reasonable cause principles to non-willful FBAR penalties, quoting Moore v. United States: “There is no reason to think that Congress intended the meaning of 'reasonable cause' in the Bank Secrecy Act to differ from the meaning ascribed to it in tax statutes.” The test is ordinary business care and prudence; see reasonable cause for how the IRS weighs it. In 750 characters the explanation should cover:

1. The reason, stated as a fact about the client, for example an inherited account, an account opened while living abroad, or a foreign pension the client did not understand to be an account.
2. Income reported. That the income from the accounts was reported and the tax paid for the years involved, if true. This is what separates the case from the streamlined procedures.
3. When and how the client learned of the requirement, and that the late reports were filed promptly after.
4. Professional reliance, if any: that a preparer was told about the accounts and did not advise filing.
5. Consistency with the returns. IRM 4.26.16.5.5.1 calls a person checking the wrong box, or no box, on Schedule B “a significant fact to consider” when deciding willful blindness or reckless disregard. An explanation that the client did not know about foreign account reporting reads differently if Schedule B answered the foreign account question “yes” every year.

An illustrative explanation for a client who inherited an account (442 characters):

Taxpayer inherited a savings account in Germany from a parent in 2021. Interest from the account was reported on Forms 1040 for 2021 to 2025 and all tax was paid. Taxpayer did not know a separate FinCEN report was required for a foreign account and learned of the requirement from a new CPA in October 2026. The late reports for 2021 to 2025 were filed within weeks of learning. No IRS contact has been received about these accounts or years.

Write it from the client’s actual facts; the IRS weighs it against the returns and any later records.

The penalty position after Bittner

The rule is in IRM 4.26.16.3.11: “A penalty will not be asserted for an account if it is determined that the failure to report the account on a timely filed FBAR was not willful, the failure to report the account on a timely-filed FBAR was due to reasonable cause, and the account was properly reported on the delinquent FBAR.” IRS Fact Sheet FS-2022-24 says the same in plainer terms: “The IRS will not penalize those who properly report a foreign financial account on a late-filed FBAR, and the IRS finds they have reasonable cause for late filing.” Two points follow. The IRS decides whether there was reasonable cause, so the explanation matters; and every account has to be on the late report, correctly.

If reasonable cause is not accepted and the violation was non-willful:

• One penalty per report, not per account. After the Supreme Court’s 2023 decision in Bittner v. United States, IRM 4.26.16.1.7 (rev. 08-26-2025) says “The failure to file a legally compliant FBAR constitutes a single reporting violation,” so “a single non-willful reporting violation can only result in a single penalty,” while willful penalties still apply per account.
• A maximum, not a fixed amount. 31 USC 5321(a)(5)(B)(i) caps the non-willful penalty at $10,000 per violation, adjusted each year for inflation under 31 CFR 1010.821. IRM 4.26.16.5.4.1 says that in most non-willful cases examiners will recommend one such penalty per violation, and that the total for all open years will not exceed 50 percent of the highest aggregate balance of the accounts involved.
• Discretion to warn instead. IRM 4.26.16.5.2.1 lets examiners consider “whether the issuance of a warning letter and the securing of delinquent and/or amended FBARs, rather than the determination of a penalty, will achieve the desired result.”

A late FBAR does not cure a willful violation. A client whose conduct may have been willful belongs in a conversation about the Voluntary Disclosure Practice before anything is filed.

Late versus amended FBARs

An FBAR that was filed on time but left out an account, or reported a wrong value, is amended, not filed as delinquent. IRM 4.26.16.3.12: check the Amended box, enter the Prior Report BSA Identifier (or 00000000000000 if it is not known), and “Complete the report in its entirety using the amended information.”

Representation and help lines

FBAR matters need their own authorization. The IRS FBAR page says a Form 2848 works if line 3 reads “Matters relating to Report of Foreign Bank and Financial Accounts” or “FBAR Examination” as the description of matter, FinCEN Form 114 as the form number, and the calendar years; a general power of attorney under state law is also accepted. The IRS FBAR Hotline is 866-270-0733 (313-234-6146 from outside the United States), Monday to Friday, 8 a.m. to 4:30 p.m. Eastern; technical questions about BSA E-Filing go to FinCEN’s help desk.

Mistakes that weaken a late FBAR

• Using this route when income was left off a return. The late FBAR does nothing for the income tax, and the explanation “all income was reported” cannot be made.
• Filing after IRS contact. The IRS instruction is for filers the IRS has not contacted about a late FBAR and who are not under investigation.
• Choosing a code and stopping. “Did not know that I had to file” without facts is a reason, not reasonable cause.
• An explanation that contradicts Schedule B. Read the filed returns first.
• Leaving accounts off the late report. The no-penalty rule applies only where the account “was properly reported on the delinquent FBAR.”
• Filing an original when an amendment is needed, or the reverse, which leaves two reports for the same year.
• Losing the BSA IDs. They are the only receipt and are needed for any amendment.

Questions practitioners ask