RUBIN ON TAX – FBAR Case Reversed – Nonwillful Filing Penalties Based on Number of Accounts Not Reported (December 14, 2021)

Charles (Chuck) Rubin published an article in the blog RUBIN ON TAX, titled “FBAR Case Reversed – Nonwillful Filing Penalties Based on Number of Accounts Not Reported”. The article begins as follows:

Back in 2000, I wrote here about a case where a taxpayer did not report multiple foreign accounts on an FBAR. The question for the court was whether the $10,000 penalty for a nonwillful failure to file meant  $10,000 per return not filed, or $10,000 per account not reported on the return. For a multi-year failure to file, if there are a lot of accounts this could dramatically impact how large the penalties are. The court held the penalty is based on a per return not filed basis.

The 5th Circuit Court of Appeals has reversed the trial court and allowed the penalty be imposed on a per account basis, and thus vastly increased the penalties for the taxpayer.

Click here to view Charles Rubin’s full summary of “Nonwillful Filing Penalties Based on Number of Accounts Not Reported”.

Posted by Isabella King, Associate Editor, Wealth Strategies Journal.

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