NO REASONABLE CAUSE DEFENSE FOR FBAR FAILURE

Taxpayers who fail to file an FBAR to report a foreign account can escape penalty if they can show reasonable cause for the failure (if the failure to file was nonwillful). A recent district court case failed to allow for reasonable cause - click here for a condensed summary of the good and bad facts and the court’s conclusions. The case illustrates that the failure of a taxpayer to disclose the account on Schedule B of their Form 1040 is a big obstacle to a finding of reasonable cause.

U.S. v. AGRAWAL, 124 AFTR 2d 2019-6970 (DC WI 2019)