FBAR Penalties — 2024–2025 Complete Guide
FBAR penalties are among the most severe in tax law. A single willful violation can result in penalties exceeding the full account balance. Understanding your exposure is the first step to reducing it.
FBAR Penalty Schedule
| Violation Type | Civil Penalty | Criminal Penalty | Notes |
|---|---|---|---|
| Non-Willful (per Bittner, 2023) | Up to $10,000 per form (not per account) | None — civil resolution | Per SCOTUS Bittner v. US (2023), non-willful penalty is per form filed, not per account |
| Willful Violation | Greater of $100,000 or 50% of account balance per account per year | Up to $250,000 fine + 5 years prison per count | Calculated per account, per year — can exceed the full account balance over multiple years |
| Negligent Violation | $500 per violation | None | Rarely asserted — applies to businesses and certain professionals |
| Pattern of Negligence | $50,000 per violation | None | Asserted when multiple negligent violations occur |
The Most Important Distinction: Willful vs. Non-Willful
Non-Willful Violation
You did not know about the FBAR requirement, or made a mistake. You did not intentionally conceal accounts.
- Penalty: up to $10,000 per form (post-Bittner)
- Eligible for Streamlined Disclosure (5% penalty)
- No criminal exposure for non-willful violations
- Most first-time FBAR cases fall here
Willful Violation
You knew about the requirement and intentionally chose not to file, or took steps to hide accounts from the IRS.
- Penalty: up to 50% of account balance per year, per account
- Multiple years can exceed 100% of account value
- Criminal prosecution possible (up to 5 years prison)
- Not eligible for Streamlined — requires VDP
How courts determine "willfulness":
Courts have found willfulness from circumstantial evidence including: checking “No” on Schedule B (which asks about foreign accounts), using foreign accounts to conceal income, transferring funds to avoid reporting thresholds (structuring), or simply having a sophisticated understanding of tax obligations. An attorney can assess whether your specific facts support a non-willful argument.
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