Tax Legal Services · Primary-source case analysis

Bittner v. United States: Nonwillful FBAR Penalties Apply Per Report

By Aneeta Mishra and Timothy Chan

Published April 13, 2026

The Bank Secrecy Act requires qualifying United States persons to report foreign financial accounts annually. Bittner resolved how the statutory maximum penalty applies to nonwillful reporting violations.

The competing penalty calculations

Alexandru Bittner filed late or inaccurate reports covering numerous foreign accounts. The government calculated a separate nonwillful penalty for each unreported account. Bittner argued that the violation was failure to file a legally compliant annual report, producing one penalty for each deficient reporting year.

The statutory focus on the report

The Court read the nonwillful provision together with the reporting obligation and the statute’s separate willful-violation language. It concluded that the relevant nonwillful breach is failure to file a compliant report. Congress knew how to tie penalties to account balances and particular accounts when it wished to do so, but the nonwillful provision did not use that formulation.

The holding

A majority held that the Bank Secrecy Act treats the failure to file one compliant annual FBAR as one nonwillful violation, carrying the statutory maximum penalty per report rather than per account. The Court reversed the Fifth Circuit and remanded. The case did not concern willful violations, which are governed by different language and potentially much larger penalties.

Compliance implications

Bittner limits one method of calculating nonwillful penalties; it does not eliminate the reporting duty or excuse inaccurate filings. Taxpayers should identify signature authority and financial interests, determine the applicable aggregate-balance threshold, preserve account records, and distinguish nonwillful conduct from facts that could support a willfulness allegation.

Key takeaways

• The nonwillful penalty is calculated per deficient annual report.
• The rule does not govern willful FBAR violations.
• Multiple accounts still must be accurately disclosed on the report.
• Facts bearing on willfulness and reasonable cause remain critical.