Tax Legal Services · Primary-source case analysis

Bittner: A Nonwillful FBAR Violation Is Counted Per Annual Report

By Aneeta Mishra and Timothy Chan

Published September 14, 2026

Alexandru Bittner filed late and inaccurate annual reports covering numerous foreign financial accounts. The government calculated nonwillful penalties account by account, while Bittner argued that the reporting obligation produced one violation for each annual report.

The reporting duty centered on an annual form

The Bank Secrecy Act directs covered persons to file reports containing information about qualifying foreign accounts. The implementing regulations require one annual FBAR that aggregates the required account information.

The nonwillful provision did not count accounts

Congress tied the nonwillful penalty to a violation of the reporting requirements without using the account-specific language found elsewhere in the statute. The Court therefore treated the failure to file one compliant annual report as one violation.

The rule was limited to nonwillful conduct

The Court did not decide how willful FBAR violations are counted. Willful penalties are governed by separate text, include account-balance references, and can produce materially different exposure.

The judgment was reversed

The Court rejected the government’s per-account calculation for Bittner’s nonwillful violations and remanded. The holding reduces the unit of penalty; it does not excuse late, incomplete, or inaccurate foreign-account reporting.

Key takeaways

• Count nonwillful FBAR violations by deficient annual report, not by account.
• Do not extend the holding automatically to willful violations.
• Accurately identify every covered account and the aggregate reporting threshold.
• Preserve facts relevant to willfulness and reasonable cause separately from penalty arithmetic.