For tax year 2000, US taxpayer J. Bryan Williams, who had an interest in and control over his two Swiss bank accounts, failed to mark “yes” to a tax return question regarding his existing foreign bank accounts, and did not file the Report of Foreign Bank and Financial Accounts (also known as “FBAR”) by June 30, 2001, deadline.
The question that arose was whether Defendant J. Bryan Williams willfully failed to report his interest in his two Swiss bank accounts for the tax year 2000. Based upon your request, I reviewed and analyzed the written decisions of both the United District Court for the Eastern District of Virginia and the U.S. Court of Appeals for the Fourth Circuit, compared the logic and reasoning of the two Courts’ decisions, and further determined which Court made the better decision.
Analysis
The District Court found that the Government (Plaintiff) did not manage to distinguish failing and willfully failing to disclose interest earnings in a foreign bank account. Moreover, the Government …show more content…
Court of Appeals did not deny that Williams checked “no” after the authorities’ awareness of his assets in the Swiss bank accounts. However, instead of “willfulness”, the concept of “willful blindness” was brought to the table. The Government held that, “willful blindness may be inferred where a defendant was subjectively aware of a high probability of the existence of a tax liability, and purposefully avoided learning the facts point to such liability.” The Government still maintained the claim that Williams’ signature on the Form 1040 was adequate proof that he was aware of the contents on his tax return form and to the best of his knowledge the information disclosed on the form was “true, accurate, and complete.” Based upon Williams’ testimony that he “never paid any attention to any of the written words” on his federal tax return, this constituted a “conscious effort to avoid learning about reporting requirements,” in other words, “willful
The question that arose was whether Defendant J. Bryan Williams willfully failed to report his interest in his two Swiss bank accounts for the tax year 2000. Based upon your request, I reviewed and analyzed the written decisions of both the United District Court for the Eastern District of Virginia and the U.S. Court of Appeals for the Fourth Circuit, compared the logic and reasoning of the two Courts’ decisions, and further determined which Court made the better decision.
Analysis
The District Court found that the Government (Plaintiff) did not manage to distinguish failing and willfully failing to disclose interest earnings in a foreign bank account. Moreover, the Government …show more content…
Court of Appeals did not deny that Williams checked “no” after the authorities’ awareness of his assets in the Swiss bank accounts. However, instead of “willfulness”, the concept of “willful blindness” was brought to the table. The Government held that, “willful blindness may be inferred where a defendant was subjectively aware of a high probability of the existence of a tax liability, and purposefully avoided learning the facts point to such liability.” The Government still maintained the claim that Williams’ signature on the Form 1040 was adequate proof that he was aware of the contents on his tax return form and to the best of his knowledge the information disclosed on the form was “true, accurate, and complete.” Based upon Williams’ testimony that he “never paid any attention to any of the written words” on his federal tax return, this constituted a “conscious effort to avoid learning about reporting requirements,” in other words, “willful