On 7/25/2012 a 64 year old man named Luis Quintero of Miami Beach recieved 4 months in prison, 250 hours of community service, a criminal fine of $20,000, and a civil penalty of $2 million. Mr. Quintero failed to report his Swiss UBS accounts, valued at $4 million, from 2005-2007. Any US persons with a financial interests or signing authority over bank accounts, brokerage accounts, or other financial accounts valued at $10,000 during a calendar year is required to file an FBAR by June 30th of the following year. Taxpayers that do not file their FBAR when required will be subject to severe penalties and even jail time. Taxpayers Non-willful FBAR violation (filing errors or mistakes) can result in a civil penalty of up to $10,000 for each violation (per account). However, if the Taxpayer willfully violates FBAR they will be subject to civil penalties that are the GREATER of $100,000 or 50% of the account balance at the time of violation. Therefore, a Taxpayer that willfully violates FBAR by not reporting a $20,000 account could be assessed a $100,000 civil penalty. The statue for assessing this penalty is 6 years. The IRS is also allowed to apply both criminal and civil penalties. The criminal penalties for willfully violating FBAR can lead to a fine of up to $250,000 or imprisonment for not more than 5 years.
In 2009 the IRS obtained a list of over 4,450 accounts held by US taxpayers from UBS so we should continue to see more FBAR cases in the future.
- Tags: FBAR