Earlier this year, the IRS was handed yet another defeat in front of the Supreme Court, which found that its interpretation of statute governing reporting of foreign financial accounts was wrong. The IRS is handling its latest judicial rebuke in the worst way possible — with a sucker punch to taxpayers who make honest mistakes.
Under the Bank Secrecy Act, American residents and citizens with foreign bank accounts are required to file a Foreign Bank Account Report (FBAR) each year. Taxpayers who fail to do so incur fines.
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