What 2022 Has Taught Us About FBAR Willfulness
The Bank Secrecy Act requires certain taxpayers to submit timely FBARs to the United States reporting their interests in foreign accounts. If a taxpayer has an FBAR filing requirement and misses it, the taxpayer can be liable for civil penalties of up to 50% of the account balances or $100,000, if the taxpayer is willful. On the other hand, if a taxpayer misses the FBAR filing deadline due to non-willfulness, the civil penalties are limited to $10,000 per violation, subject to reasonable cause.
What is the difference between willfulness and non-willfulness? Good question. Because the concept of willfulness can include recklessness—and the scope of non-willfulness includes negligence and inadvertence—the line between willful and non-willful is not an easy one to define. Accordingly, federal courts have been left to grapple with the distinction.
So far in 2022, federal courts have issued five important cases on willfulness. Each of these is discussed more below.
Recent Comments