FBAR Penalties & IRS Foreign Information Returns
Reporting Obligations, Penalty Exposure & Compliance Guidance
Understanding FBAR Penalties
If you’re facing FBAR penalties, timing and strategy both matter. U.S. persons with foreign financial accounts or foreign business interests often face reporting duties beyond a standard tax return — including the FBAR (FinCEN Form 114) and, depending on your situation, IRS foreign information returns such as Forms 8938, 5471, 5472, 3520, 8621, and 8865. The IRS maintains an overview of who must file an FBAR.
How FBAR Penalties Are Calculated
Taxpayers who fail to timely file a complete and correct FBAR may face civil monetary penalties, criminal penalties, or both, depending on the facts involved.
- Non-willful violations carry lower exposure but still require careful handling.
- Willful violations carry the greatest exposure: the greater of $100,000 or 50% of the account balance at the time of the violation, for each violation.
Because “willfulness” is a fact-intensive determination, how your case is presented — and when you seek help — can significantly affect the outcome.
Reducing Your Penalty Exposure
Our CT tax attorneys and CPAs work together on every foreign reporting case, combining legal strategy with the financial precision the IRS expects. If you’re behind on filings or responding to a notice, our IRS appeals experience can also help protect your position. Our team has helped clients reduce FBAR penalties through timely voluntary disclosure and careful case presentation. Contact us before you take any action on an FBAR or foreign information return issue.
