FBAR Penalties Not Subject to Collection Due Process Hearing Procedures (T.C.) (IRC §6330)

Foreign Bank Account Reporting (FBAR) penalties are not taxes imposed by the Internal Revenue Code and thus are not subject to the collection due process (CDP) procedures under I.R.C. §§6320 and 6330, held the U.S. Tax Court, granting the IRS’s motion to dismiss for lack of jurisdiction. Petitioners, a married couple, were assessed FBAR penalties under 31 U.S.C. §5321 for failing to timely file foreign bank account reports for tax years 2005–2009. After receiving notice that the Treasury’s Bureau of the Fiscal Service would withhold funds from their monthly Social Security benefits through the Treasury Offset Program, Petitioners requested CDP ...