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Tax Notes Quotes Zhanna Ziering: Court Finds FBAR Willfulness for Schedule B Failure, Little Else

January 23, 2019, Tax Notes

Taxpayers' fears that courts are arguably moving the goal posts on what constitutes a willful violation of foreign bank account reporting are being validated.

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Zhanna Ziering of Caplin & Drysdale also noted the “tremendous amount of emphasis” Horowitz placed on the failure to check the box on Schedule B.

“If that fact alone is sufficient to find a willful violation, especially in a context of a summary judgment motion, the statutory distinction between willful and non-willful penalties becomes irrelevant,” Ziering said. She pointed out that the decision in Flume said that if every taxpayer who signs the return is presumed to know of FBAR requirements, "it is difficult to conceive of how a violation could be non-willful." Ziering added that even in the Internal Revenue Manual, "the IRS acknowledges that it needs additional factors to establish willfulness. However, in litigation, this single act seems to become a predominate indicia of willfulness.”

For the full article, please visit Tax Notes’ website (subscription required).

Excerpt taken from the article “Court Finds FBAR Willfulness for Schedule B Failure, Little Else” by Andrew Velarde for Tax Notes.

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