2019 – 08/21
Taxpayers who have certain foreign financial accounts must report them on their tax returns. They may also have to file a “Report of Foreign Bank and Financial Accounts” (FBAR). One taxpayer failed to file an FBAR for two financial accounts with a Canadian entity. The balances ranged from $400,000 to over $1 million. The IRS assessed failure-to-file and late payment penalties, as well as interest. She argued that the failure to file was due to reliance on an advisor to complete her returns. A U.S. District Court found the taxpayer had taken no steps to learn her obligations and hadn’t informed the advisor about the account. Penalties and interest were upheld. (Ott, DC MI, 8/7/19).