Here are two recent cases regarding FBAR - One, a taxpayer win and the other a taxpayer loss. Let's start with the good news: The taxpayer win! The penalty for non-willful FBAR violations is generally US$10,000 per violation. The question is, what is the "violation"? The Internal Revenue Service (IRS) believes this penalty applies for … Continue reading FBAR Developments: “Non-Willful” Taxpayer Wins & “Willful” Dead Taxpayer Loses Beyond the Grave!
Today’s post involving the case of Jonathan Zuhovitzky presents some important takeaways: The IRS can get very aggressive when it comes to assessing “willful” FBAR penalties. We see this trend is on the rise. A diligent representative, however, can get the IRS to settle an FBAR matter that is favorable to the taxpayer. It takes … Continue reading Taxpayer’s FBAR WIN: “Willful” Penalty over $9.8 Million for Mere Signature Authority — Removed Entirely
Please spread the word and share this news. I will be making FBAR matters simple in a cost-effective live online training session along with my colleague, Jimmy Sexton, LL.M. a fellow international tax expert. Whether you are preparing your own FBARs or those of your clients, the truth is that some FBAR situations are simple … Continue reading REMINDER: Wondering if You (or Your Clients) Need to File an FBAR or Have Been Preparing Them Correctly?
As all my readers know, the Bank Secrecy Act (BSA) has been requiring US taxpayers to report certain foreign financial accounts and retain detailed records about them. Failing to file or to properly report all foreign accounts on the notorious “FBAR” (FinCEN Form 114, Report of Foreign Bank and Financial Accounts) can result in very high … Continue reading No IRS! The Sky is NOT the Limit….MAJOR FBAR WIN! Penalty is Per FBAR Form, Not Per Account
It’s been no secret that virtual currency has been in the crosshairs of the Internal Revenue Service (IRS) for some time. Virtual currency is one of the IRS “campaigns” and criminal investigations related to crypto have already started. The IRS has been sending taxpayers “educational” letters to remind them and warn them of their tax … Continue reading The Times They Are a Changin’ – FBAR Reporting of Virtual Currency Foreign Accounts
It’s been awhile since I have blogged about our friend, Mr. FBAR. For those of you who are not familiar with his nickname, you may know him by his more formal moniker “Report of Foreign Bank and Financial Accounts” (FinCEN Form 114). He springs from Title 31 of the Bank Secrecy Act (not the Internal … Continue reading FBAR “Willfulness” – Fifty Shades of Gray
The Internal Revenue Service (IRS) and the Financial Crimes Enforcement Network (FinCEN) will jointly examine application of foreign account reporting requirements to virtual currency held in an offshore account under the Bank Secrecy Act (the notorious FBAR, Form 114). Two important points about FBAR duties for foreign accounts holding virtual currency were made in a … Continue reading FinCEN: No FBAR Reporting for Virtual Currency in an Offshore Account
I have been keeping readers up to date with the current controversy surrounding imposition of an FBAR penalty for “willful” violations. Here’s an overview of where we are to date. “Willful” Penalty Ceiling: The Cases So Far Last year, two district courts had limited the FBAR “willfulness” penalty to $100,000 because the Department of Treasury did … Continue reading IRS Hits the Jackpot: Another District Court Rejects $100,000 Cap on FBAR Penalty
UPDATE December 2018 - My interview with attorney John Richardson on the new IRS voluntary disclosure procedures. As many will remember, the Offshore Voluntary Disclosure Program (OVDP) closed on September 28th with the promise that the Internal Revenue Service (IRS) would issue new guidance on voluntary disclosures made after that date. The guidance just arrived … Continue reading It’s Finally Here: The IRS Bible for Voluntary Disclosures
In a recent FBAR case involving an unreported foreign account maintained at none other than UBS in Switzerland, the court was called upon to decide whether the FBAR civil “willful” penalty assessed against the taxpayer survived his death. The case is United States v. Schoenfeld (Middle District, Fla. 3:16-cv-1248-J-34PDB), dated 9/25/18, and the court order … Continue reading Recent Case “Willful” FBAR Penalty: Even Death is No Escape!