Treasury regulations require an individual to file a Report of Foreign Bank and Financial Accounts ("FBAR") with the IRS for each calendar year that individual has more than $10,000 in a foreign bank account.
If an individual fails to file an FBAR, the IRS may impose a civil penalty of up to $10,000 for each violation. If an individual "willfully" fails to file an FBAR, the permissible penalty increases to the greater of either $100,000 or 50 percent of the value in the account at the time of the violation.
The Supreme Court just refused to review a lower court decision imposing a $3,000,000 penalty for willfully failing to file the FBAR for five years. She finally filed in year six and the IRS caught her. The penalty was half of the balance in her UBS account for each of the five years.
Don't forget to file. Also check the box on your tax return for a foreign bank account.
There was one dissent (by Gorsuch) who thought the amount violated the Eighth Amendment prohibition against excessive penalties.
If an individual fails to file an FBAR, the IRS may impose a civil penalty of up to $10,000 for each violation. If an individual "willfully" fails to file an FBAR, the permissible penalty increases to the greater of either $100,000 or 50 percent of the value in the account at the time of the violation.
The Supreme Court just refused to review a lower court decision imposing a $3,000,000 penalty for willfully failing to file the FBAR for five years. She finally filed in year six and the IRS caught her. The penalty was half of the balance in her UBS account for each of the five years.
Don't forget to file. Also check the box on your tax return for a foreign bank account.
There was one dissent (by Gorsuch) who thought the amount violated the Eighth Amendment prohibition against excessive penalties.
