Foreign Income & FBAR: International Reporting and Tax Compliance

Categories: Federal Tax, IRS CE
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About Course

U.S. taxpayers with foreign income, financial accounts, or overseas assets face a complex web of cross-border reporting obligations — and the penalties for non-compliance can be severe. This 2-CE-hour course equips tax professionals with a comprehensive understanding of the three primary international reporting frameworks: the Foreign Earned Income Exclusion (FEIE) under IRC §911 and Form 2555; FBAR reporting under the Bank Secrecy Act and FinCEN 114; and FATCA reporting under IRC §6038D and Form 8938. Participants learn to identify clients subject to these requirements and prepare the corresponding forms accurately.

Across four structured modules, participants apply the bona fide residence and physical presence tests, calculate the housing exclusion, distinguish between FBAR and FATCA thresholds and asset definitions, evaluate willful and non-willful FBAR penalty exposure in light of Bittner v. United States (2023), and advise clients on voluntary disclosure options including the Streamlined Filing Compliance Procedures. The course concludes with Circular 230 due diligence obligations specific to international tax engagements and practitioner strategies for common compliance scenarios.

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What Will You Learn?

  • Apply the Foreign Earned Income Exclusion under IRC §911 using both residency tests
  • Determine FBAR filing obligations under 31 U.S.C. §5314 and the aggregate threshold rule
  • Distinguish between FBAR and Form 8938 FATCA reporting requirements
  • Advise clients on appropriate voluntary disclosure procedures for unreported foreign accounts
  • Apply Circular 230 §10.21 obligations when discovering international non-compliance

Course Content

Module 1 – Foreign Earned Income Exclusion (FEIE) — IRC §911 and Form 2555
This module covers the FEIE under IRC §911 in full practice depth: the bona fide residence and physical presence tests, tax home requirement, exclusion ceilings ($126,500 for 2024; $130,000 for 2025), housing exclusion calculation, Form 2555 preparation, the §911(f) stacking rule, and interaction with the foreign tax credit. Participants learn to identify common IRS audit triggers and avoid frequent practitioner errors in FEIE claims.

  • Foreign Earned Income Exclusion (FEIE) — IRC §911 and Form 2555

Module 2 – FBAR Compliance — FinCEN 114 and Bank Secrecy Act Obligations
This module examines the FBAR filing obligation under 31 U.S.C. §5314 and 31 C.F.R. §1010.350: who must file, which accounts are reportable, the $10,000 aggregate threshold, FinCEN 114 preparation, signature authority accounts, and the civil and criminal penalty structure. Participants apply the Bittner v. United States (2023) per-report non-willful penalty rule and learn the delinquent FBAR submission procedures.

Module 3 – FATCA and Form 8938 — Foreign Financial Assets and Dual Reporting
This module covers FATCA reporting under IRC §6038D and Form 8938, including specified foreign financial asset definitions, domestic and foreign resident filing thresholds, the critical distinctions between FBAR and Form 8938, the §6501(c)(8) extended statute of limitations, interaction with Forms 5471, 8865, and 3520, and penalty and reasonable cause waiver procedures.

Module 4 – Voluntary Disclosure, Practitioner Strategy, and Circular 230 Compliance
This module addresses non-compliance remediation: the IRS Voluntary Disclosure Practice, the Streamlined Domestic Offshore Procedures (5% penalty), the Streamlined Foreign Offshore Procedures (zero penalty), delinquent FBAR and information return submission procedures, the non-willful certification requirements, documentation and recordkeeping standards, and Circular 230 §§10.21, 10.22, 10.34, and 10.51 obligations in international engagements.

Final Assessment – Foreign Income & FBAR: International Reporting and Tax Compliance
You have completed a comprehensive review of U.S. international tax reporting requirements, covering the Foreign Earned Income Exclusion under IRC §911, FBAR compliance under the Bank Secrecy Act, FATCA reporting under IRC §6038D, and voluntary disclosure strategies and Circular 230 obligations. You are now prepared to demonstrate your understanding of the key concepts. The following final examination assesses your knowledge of the material covered in all four modules. A passing score of 70% is required to successfully complete the course.

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