Procedurally Taxing: Are FBAR Penalties Taxes for Purposes of the Flora Rule? (April 19, 2021)

Keith Fogg, Clinical Professor of Law at Harvard Law School , discusses Mendu v. United States, No. 1:17-cv-00738 (Ct. Fd. Claims April 7, 2021).

In Mendu v. United States, No. 1:17-cv-00738 (Ct. Fd. Claims April 7, 2021) the Court of Federal Claims held that FBAR penalties are not taxes for purposes of applying the Flora rule.  In arguing for the imposition of the Flora rule the taxpayer, in a twist of sides, sought to have the court require that the individual against whom the penalties were imposed to fully pay the penalties before being allowed to challenge the penalties in court.  The FBAR penalties are not imposed under title 26 of the United States Code which most of us shorthand into the Internal Revenue Code but rather are imposed under Title 31 as part of the Bank Secrecy Act.

To see the full article, click here: “Are FBAR Penalties Taxes for Purposes of the Flora Rule?”

To download the full opinion, click here: Mendu v. United States, No. 1:17-cv-00738 (Ct. Fd. Claims April 7, 2021)

Posted by Elise Kim, Managing Associate Editor, Wealth Strategies Journal.

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