FBAR Attorney — Foreign Account Violations & Penalty Defense
FBAR penalties start at $10,000 per violation and can exceed the full account balance for willful non-compliance. If you have unreported foreign accounts, act now — voluntary disclosure dramatically reduces penalties.
FBAR Penalty Overview
Non-Willful Violation
Up to $10,000 per form
Per Bittner v. US (2023) — per form, not per account
Willful Violation
$100,000 or 50% of account balance (whichever is greater)
Per account, per year — can exceed total account balance
Criminal Prosecution
Up to $250,000 fine + 5 years imprisonment
For willful violations under the Bank Secrecy Act
How We Resolve FBAR Violations
The right resolution strategy depends on whether your violation was willful, how many years are at issue, and whether the IRS has already contacted you.
Streamlined Domestic Offshore Procedures
Penalty: 5% miscellaneous offshore penalty
Who qualifies: U.S. residents with non-willful violations
Ideal for: Most clients who simply forgot or didn't know
Streamlined Foreign Offshore Procedures
Penalty: 0% penalty
Who qualifies: U.S. persons residing outside the U.S.
Ideal for: Expats with unreported foreign accounts
Delinquent FBAR Submission
Penalty: No penalty if no unreported income
Who qualifies: Missed FBARs but all income was reported correctly
Ideal for: Taxpayers who reported the income but missed the FBAR
IRS Voluntary Disclosure Program (VDP)
Penalty: Negotiated — avoids criminal prosecution
Who qualifies: Willful violators seeking criminal protection
Ideal for: High-risk cases where willfulness is likely
How the IRS Finds Unreported Foreign Accounts
FATCA Reporting
113+ countries automatically report U.S. account holders to the IRS every year. Your foreign bank has likely already reported you.
Swiss Bank Agreements
DOJ agreements with UBS, Credit Suisse, and others produced tens of thousands of American names. More banks cooperate every year.
John Doe Summonses
Courts allow the IRS to demand records for entire groups of unnamed taxpayers — often producing thousands of account records at once.
Bottom line: If you have foreign accounts, assume the IRS either has or will get this information. Voluntary disclosure before IRS contact is always the safer path.
FBAR Frequently Asked Questions
What is an FBAR and who has to file it?
FBAR stands for Report of Foreign Bank and Financial Accounts (FinCEN Form 114). Any U.S. person — citizens, green card holders, and U.S. residents — must file an FBAR if they had a financial interest in or signature authority over foreign financial accounts with an aggregate value exceeding $10,000 at any point during the calendar year. This includes bank accounts, brokerage accounts, mutual funds, and certain retirement accounts held at foreign financial institutions.
I didn't know I had to file an FBAR. Will I still be penalized?
The good news is that the IRS distinguishes between willful and non-willful FBAR violations. Non-willful violations — meaning you simply didn't know about the requirement — are eligible for the Streamlined Filing Compliance Procedures, which carry a 5% offshore penalty (or zero for expats) instead of the full $10,000+ per violation. The key is to act before the IRS contacts you, because voluntary disclosure before examination gives you far more options.
How does the IRS find out about foreign bank accounts?
Through FATCA (Foreign Account Tax Compliance Act), foreign banks in 113+ countries are required to report U.S. account holders to the IRS. Swiss banks have turned over thousands of names via DOJ agreements. The IRS also uses John Doe summonses to obtain mass account data from banks. If you have a foreign account, assume the IRS either has this information or will get it.
Can I just file the FBARs quietly without using a formal program?
"Quiet disclosure" — filing late FBARs without entering a formal program — is strongly discouraged. The IRS has explicitly warned that it may treat quiet disclosures as potential criminal violations and audit them aggressively. Using the Streamlined Program under attorney guidance gives you legal protection that a quiet disclosure does not.
What is the statute of limitations for FBAR penalties?
The IRS has 6 years from the due date of the FBAR (or the date filed, if later) to assess FBAR penalties. This is longer than the standard 3-year income tax statute. However, for willful violations, there is no statute of limitations for criminal prosecution until 5 years after the violation.
Do I need an attorney or can I use an accountant for FBAR issues?
For simple delinquent FBAR filings with no unreported income, a knowledgeable CPA may be sufficient. For any case involving unreported foreign income, potential willfulness, or existing IRS contact, you need an attorney. Attorney-client privilege protects communications with your lawyer — it does not protect communications with your accountant. This distinction is critical in any case that could become criminal.
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