Taxpayers Die but Their International Penalties Live On



A long list of cases over the past decade have centered on the proper definition of “willfulness” in the context of penalties for an unfiled, incomplete, or inaccurate FinCEN Form 114 (Report of Foreign Bank and Financial Accounts) (“FBAR”). However, those cases did not address some key issues, including (i) whether the Internal Revenue Service, with help from the Department of Justice (“DOJ”),can assess and/or collect penalties after the taxpayer who committed the FBAR violation dies, and (ii) if so, against whom can the IRS and DOJ take action, the deceased individual, a surviving spouse, the executor of the estate, beneficiaries of the estate, transferees, others?

This article analyzes a series of recent cases centered on post-death actions by the IRS and DOJ, giving special attention to the question of the survivability of FBAR penalties.

Click here to read the full article.

About Hale E. Sheppard

HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.) is a Shareholder in the Tax Controversy Section of Chamberlain Hrdlicka and Chair of the International Tax Group.

Popular posts from this blog

Conservation Easement Settlement Initiatives in 2020 and 2024

Image
The IRS recently launched its second major effort to dispense with cases involving what it calls syndicated conservation easement transactions. In order for partnerships and their partners to make intelligent decisions, they first need to understand the context. This includes the types of challenges the IRS raises in easement disputes, the terms of the initial settlement introduced back in 2020, the terms of the current settlement launched in 2024, and the types of partnerships to which the current settlement might appeal. This article covers those topics and more. Read the full article here. About Hale E. Sheppard HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.)  is a partner in the Tax Controversy Section of Chamberlain Hrdlicka.  He defends clients in tax audits, tax appeals, and Tax Court litigation, covering both domestic and international issues.
Read more

A Comprehensive Look at ERC Enforcement Tactics So Far

Image
Most people are somewhat confused about Employee Retention Credit (“ERC”) issues. This is logical given the massive amount of information, much of it inaccurate, released by various sources over the past four years. Among the aspects that escape most people are the enforcement actions taken by the IRS. Understanding these is critical because taxpayers and other parties that might end up in the IRS’s crosshairs cannot effectively defend themselves if they do not know what their adversary is doing. This article, another in a long series, explores the major enforcement tactics used by the IRS thus far in challenging what it considers improper ERC claims. Read the full article here. About Hale E. Sheppard HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.)  is a partner in the Tax Controversy Section of Chamberlain Hrdlicka.  He defends clients in tax audits, tax appeals, and Tax Court litigation, covering both domestic and international issues.
Read more

Improper ERC Claims: IRS vs. Taxpayers vs. Payroll Companies

Image
When people think about tax enforcement, they rarely consider the IRS attacking payroll companies based on benefits they claimed for their clients, but this is happening with the Employee Retention Credit (“ERC”). What makes this more interesting is that the IRS is attacking both payroll companies and their clients thanks to their joint liability in certain situations. This reality sets the stage for primary battles against the IRS, accompanied by secondary clashes between payroll companies and their clients. The finger pointing has already started, and it will no doubt intensify as ERC enforcement escalates. This article analyzes four recent sources of IRS guidance about which parties will be on the hook when ERC claims get disallowed. Read the full article here. About Hale E. Sheppard HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.)  is a partner in the Tax Controversy Section of Chamberlain Hrdlicka.  He defends clients in tax audits, tax appeals, and Tax Court lit...
Read more