Tax Legal Services · Primary-source case analysis

Bittner: Earlier Agency Warnings Mattered, but the Lenity Rationale Had Only Two Votes

By Aneeta Mishra and Timothy Chan

Published September 14, 2026 · Updated October 18, 2026

Decision: Bittner v. United States, 598 U.S. 85 (2023).

Can an agency’s own earlier warnings matter when it later seeks a larger penalty in court? In Bittner v. United States, 598 U.S. 85 (2023), the majority considered the government’s public descriptions of nonwillful FBAR penalties as supporting context. The Court ultimately counted those violations per deficient report, not per account. Its treatment of the guidance—and the limited support for a separate lenity discussion—shows why the reasoning must be read as carefully as the result.

Public guidance had warned about a report-level penalty

The majority collected a Treasury proposed-rule notice, an IRS letter, form instructions, and an IRS fact sheet that described failure to file an FBAR in terms of a single maximum nonwillful penalty. Those materials did not describe multiplying the penalty by every account omitted from one report. That contrast mattered when the government defended a $2.72 million calculation based on 272 accounts across five reporting years. The figures describe Bittner’s historical assessment, not a statement of today’s inflation-adjusted penalty cap. Bittner, slip op. at 3–4,9–10.

The guidance was persuasive context, not controlling law

The Court expressly said the guidance did not control its independent interpretation of the statute. Instead, inconsistency could reduce the persuasiveness of the government’s new reading. Footnote 5 also clarified that the majority was not claiming the guidance had consistently endorsed Bittner’s interpretation. The narrower point was that the government’s earlier public wording counted against the position it advanced in court. Do not treat an old agency fact sheet as a substitute for statutory text or as an automatic defense to every assessment. Bittner, slip op. at 9–10 and footnote 5.

The lenity discussion did not command a majority

Justice Gorsuch also discussed the rule of lenity in Part II–C, joined only by Justice Jackson. That section invoked strict construction of penalty statutes and fair-warning concerns. The per-report holding had majority support, but that separate two-Justice rationale did not. A reader should not attribute the entire lenity discussion to “the Court” simply because it appears in the same document as the majority opinion. The statutory-text and contextual analysis in Parts II–A and II–B had the broader support identified on the opinion’s first page. Bittner, slip op. at 1,14–16.

The holding left other penalty questions open

The Supreme Court reversed and remanded. It did not decide what mental state, if any, the government must establish for a nonwillful penalty. It also reserved whether a late report followed by an inaccurate report could produce two reporting violations, and did not resolve the separate recordkeeping duty. The outcome therefore does not support a promise that every problem for one reporting year always produces exactly one penalty, regardless of the conduct involved. Bittner, slip op. at 6 footnote 1,8 footnote 3,8–9 footnote 4,16.

Key takeaways

• Compare the actual statutory language with the agency material being invoked.
• Distinguish persuasive inconsistency from a binding agency interpretation.
• Check which Justices joined a particular rationale before calling it the Court’s holding.
• Keep expressly reserved reporting, recordkeeping, and mental-state questions separate.