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Can I be penalized for an FBAR mistake if it was an honest error?

The FBAR penalty regime distinguishes non-willful from willful violations. A non-willful violation, meaning an honest oversight rather than a deliberate attempt to hide accounts, carries a much smaller penalty, and the Supreme Court ruled in Bittner v. United States (2023) that the non-willful penalty applies per form, not per account. Willful violations, where you knew of the requirement and chose to ignore it, expose you to far steeper penalties and potential criminal exposure. The IRS looks at your facts and history. If you simply did not know, correcting through the Delinquent FBAR or Streamlined procedures dramatically reduces risk. Document your good-faith efforts. The takeaway: honest mistakes are treated more leniently, but ignoring the requirement once you know about it is what gets people into serious trouble.

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