Advanced Strategies for Challenging FBAR Penalties: Using Administrative Procedures Act In Defending Against Assessments

Recording of a 90-minute CLE/CPE webinar with Q&A


Conducted on Wednesday, July 26, 2017

Recorded event now available

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Program Materials

This webinar will provide tax counsel and advisers with a thorough and practical guide to strategies for administrative challenges and defenses against penalty assessments for FBAR violations. The panel will contrast the penalty structures between FBAR and other foreign-related information filings and focus on remedies available under the Administrative Procedures Act (APA) for challenging FBAR penalties.

Description

The IRS continues to aggressively pursue penalties for failure of U.S. taxpayers to accurately file information reports on foreign assets. This is particularly true in the case of failure to file a FinCen Form 114 (FBAR), where the Service has had several high-profile court victories upholding penalties for willful failure to file.

Unlike FATCA, which requires taxpayers to disclose information on a wide range of foreign assets which is governed by the Internal Revenue Code and Title 26 of the U.S. Code, FBAR penalty assessments are governed by Title 31 of the U.S. Code rather than the Internal Revenue Code. For taxpayers facing FBAR penalties, this distinction can provide additional opportunities for challenging penalty assessments under the Administrative Procedure Act (APA). The APA subjects federal agency actions to judicial review, to prove the agency is acting within the scope of its authority.

The IRS has traditionally been protected from this level of scrutiny in its assessment and enforcement actions. Given that the source of FBAR penalties is Title 31 and not Title 26, administrative remedies under the APA may be available to a taxpayer in challenging an FBAR assessment. These remedies are separate from those generally available to challenge tax penalties, and tax counsel must be aware of potential APA arguments in strategizing a defense against FBAR penalties.

Listen as our experienced panel provides thorough and practical guidance to administrative claims and defenses potentially available to taxpayers facing FBAR penalties.

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Outline

  1. Significance of FBAR penalties under Title 31
  2. Potential application of Administrative Procedures Act to FBAR penalty defenses
  3. Strategic considerations for determining whether to make an APA argument
  4. Timing Issues
  5. Prior invocation of APA argument in FBAR case (Moore v. U.S.)
  6. Designing an FBAR defense strategy

Benefits

The panel will discuss these and other important topics:

  • Why does the APA provide possible grounds for defending against FBAR penalty assessments that are not available to taxpayers challenging other IRS foreign-related penalties?
  • Whether and at what point in the appeals process should taxpayers put forth an administrative challenged based on the APA?
  • Should taxpayers go through a pre-assessment administrative review if they are considering an APA claim?
  • What impact does an administrative claim under the APA have on the payment timing?

Faculty

Horwitz, Robert
Robert Horwitz

Hochman Salkin Rettig Toscher & Perez

Mr. Horwitz has over 35 years of experience as a tax attorney specializing in the representation of clients in civil...  |  Read More

Toscher, Steven
Steven Toscher, Esq.

Hochman Salkin Rettig Toscher & Perez

Mr. Toscher has been representing clients for more than 35 years before the IRS, the Tax Divisions of the U.S....  |  Read More

Anthony V. Diosdi
Anthony V. Diosdi

Moskowitz

Mr. Diosdi's practice focus is on U.S. international tax, litigation, and tax controversy. Prior to joining...  |  Read More

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