IRS Win on Foreign Holdings Penalties Seen as Blow to Taxpayers

May 8, 2024, 8:39 AM UTC

Taxpayers will pay more penalties and face a greater risk of having to fight the IRS over fines they consider unfounded as a result of a recent D.C. Circuit ruling on foreign holdings.

The decision is a sharp reversal in a tax case that lawyers say could have broad implications in how the IRS collects penalties.

The US Court of Appeals for the D.C. Circuit reaffirmed in a May 3 ruling that the IRS can automatically issue penalties to taxpayers who fail to report foreign holdings, overturning a US Tax Court ruling last year saying the agency lacked authority to ...

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