It's that time of year again. Various football teams scramble at the end of the regular season for a chance at the playoffs. And with each game's conclusion spectators get an updated "playoff picture" with respect to where each team stands. In that same spirit, as we begin 2022, it is helpful to see a "playoff picture" of the current legal landscape for FBAR violations, specifically non-willful violations. Certainly, football playoff games are more eventful than federal court decisions; however, such court decisions are no less impactful, particularly for those taxpayers with unreported foreign accounts.
FBARs, Generally
The Bank Secrecy Act, passed by Congress in 1970, authorized the Department of Treasury to collect certain information from U.S. persons who have financial interests in or signature authority over financial accounts maintained with financial institutions outside the United States. Further, in April 2003, the Financial Crimes and Enforcement Network ("FinCEN") delegated its enforcement authority with respect to FBARs to the Internal Revenue Service.1
U.S. persons must file a FinCEN Form 114, Report of Foreign Bank and Financial Accounts ("FBAR"), if the aggregate maximum values of the foreign financial accounts exceed $10,000 at any time during the calendar year. For purposes of FBAR reporting, a "U.S. person" includes a citizen or resident of the United States, an entity created or organized in the United States or under the laws of the United States (including corporations, partnerships, and limited liability companies), a trust formed under the laws of the United States, or an estate formed under the laws of the United States.2
31 U.S.C. ' 5321
A U.S. person may be subject to certain...
