Thanks for the posting.
FWIW, the Bittner case did not really involve FATCA. The Americans Overseas article only mentions it tangentially. (I have changed the subject line to something a bit more accurate.)
Bittner contested fines applied under the
Bank Secrecy Act. This is the notorious
FBAR form, FinCEN 114. The IRS wanted to apply a $10,000 penalty
per account over five years. However, Bittner asserted, and the court agreed, that the $10,000 penalty could apply only
per report, so $10,000/year.
The government's demand for $2,720,000 was clearly absurd, but even after winning the case, a fine of $10,000/year for simply and accidentally failing to file a single piece of (virtual) paperwork, with no consequent loss of tax or any other revenue to the government caused by this omission, still stands. And this is outrageous in and of itself; at the limit, 100% of your money (not gains, but
principal).
The $10,000
threshold for filing the FBAR was set in 1970, when $10,000 was a decent amount of money. It has
never been raised, so thanks to inflation, ever more people now have FBAR filing requirements. However, in a striking and epic display of double standards, in 2015 congress cited "inflation" as their justification for
raising the FBAR
penalties from $10,000 and $100,000 (wilful) to $12,459 and $124,588, and increasing annually with inflation from then onwards.