Key Takeaways The United States taxes its citizens and residents on worldwide income , regardless of where it is earned or where accounts are held FBAR filing requirements apply to anyone with foreign financial accounts exceeding $10,000 in aggregate at any point during the year FATCA reporting on Form 8938 adds another layer of disclosure requirements for specified foreign financial assets Penalties for non-compliance can be devastating: up to $100,000 or 50% of account balance per violation for willful FBAR violations The IRS Streamlined Filing Compliance Procedures offer a path to come into compliance without criminal exposure for non-willful taxpayers Working with an experienced international tax defense team is essential to navigating these complex obligations Understanding US Tax Obligations on Worldwide Income International tax compliance is a critical area of tax law that affects millions of US taxpayers. Whether you are a US citizen living abroad, an immigrant with financial connections to your home country, a business owner with international operations, or an investor with foreign holdings, understanding your US tax obligations on worldwide income is the foundation of compliance. The consequences of non-compliance have never been more severe, and the IRS has never been better equipped to detect violations. The United States is one of only two countries in the world that taxes its citizens on their worldwide income, regardless of where they live or where the income is generated. This citizenship-based taxation system creates extensive reporting obligations for millions of Americans living abroad, immigrants with financial ties to their home countries, and anyone holding foreign financial assets. Under the Internal Revenue Code, US citizens, permanent residents (green card holders), and individuals meeting the substantial presence test must report all income from all sources worldwide. This includes wages earned in foreign countries, interest and dividends from foreign bank and...