Hello and thank you for using Just Answer.
You are correct as a US citizen you are to file a tax return on worldwide income. The Foreign Income Exclusion is for Earned Income (I mention this because you stated your age as 2 for income and if that was from investments then the exclusion would not apply). There is a foreign tax credit that could be used to lessen a tax burden on US return for paying tax in another country on the same income.
The statute of limitations is 3 years for the IRS go back and audit a filed return. The statute begins when the return is filed so if no return was filed then the statute does not start. Generally a taxpayer can file for the past 3 years but in your case you should start with the past 5 and the main problem you may have is in not having filed any FBAR (Form 90-22.1) reporting on foreign accounts over $10,000. If you have not filed those but had any accounts in a country other than the US that had at any time in a tax year more than $10,000 you need to file those forms. I advise on 5 years because the US requires the past 5 years returns when one wants to give up their US citizenship. Not that I am implying you want to do this but it is best place to start.
They can hold you liable for every year that you did not file and your responsibility was to file. FBAR was written in 1970 but has been amended over the years.
What is a financial interest?
The term “financial interest” is now defined as an interest held by a U.S. person if the person is the owner of record of the interest or the U.S. person has legal title over the interest “whether the account is maintained for his or her own benefit or for the benefit of others, including non-United States persons”. So now “financial interests” can include the following:
Accounts at foreign financial institutions held for the benefit of minor children