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Tax Notes Quotes Zhanna Ziering: Government Appeals FBAR Loss in Bedrosian

November 20, 2017, Tax Notes

The U.S. government gave notice of its eleventh-hour appeal to the Third Circuit in Bedrosian November 17, challenging a significant recent litigation loss related to the failure to file a foreign bank account report.

The importance of the case is widely understood in the tax community and Zhanna Ziering of Caplin & Drysdale was not surprised by the government’s appeal. After a series of government successes in litigating against willful FBAR violators with bad facts, practitioners have argued that Bedrosian potentially represents a move away from de facto strict liability and to a closer examination of circumstances surrounding particular taxpayers.

“The court’s decision in Bedrosian has finally pushed back on the government’s approach to FBAR cases. The court dissected the statutory requirements and zeroed in on what occurred at the time of the FBAR delinquencies rather than on the prior behavior. This was a fact-specific win for the taxpayer," Ziering said, adding that the government could always argue that the case was limited to its facts going forward. She added that a government win at the appellate level would return FBAR litigation to the previous state of play, where it was difficult for a taxpayer to overcome a presumption of knowledge and intent based on a signature on a return. “But, if the Third Circuit upholds the district court’s decision, the government’s hazards will significantly magnify,” Ziering argued.

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

Excerpt taken from the article “Government Appeals FBAR Loss in Bedrosian” by Andrew Velarde for Tax Notes.


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