A Half-Million Dollar Fine for a Tax Paperwork Oversight |
IRS
A Half-Million Dollar Fine for a Tax Paperwork Oversight
Too many courts ignore the Eighth Amendment’s ban on excessive fines.
J.D. Tuccille | 5.20.2026 7:00 AM
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Most of us would consider a half-million dollar fine for overlooking less than $30,000 in federal taxes to be excessive. Our astonishment at the penalty would only increase upon learning that the oversight resulted from a paperwork violation, with no evidence of deliberate evasion. But a federal judge signed off on the fine, saying that she deferred to the IRS in finding the punishment "not excessive." Now, 88-year-old retiree Tuncay Saydam is hoping the Ninth Circuit Court of Appeals will reach a more reasonable conclusion.
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Running Afoul of an 'Obscure and Seemingly Benign Tax Form'
According to the IRS, "per the Bank Secrecy Act, every year you must report certain foreign financial accounts, such as bank accounts, brokerage accounts and mutual funds, to the Treasury Department and keep certain records of those accounts. You report the accounts by filing a Report of Foreign Bank and Financial Accounts (FBAR) on Financial Crimes Enforcement Network (FinCEN) Form 114."
Tuncay Saydam was born in Turkey and has dual U.S. and Turkish citizenship. For years, he maintained bank accounts in Turkey, where he lived until 1980 before coming to this country to become a computer science professor at the University of Delaware. The overseas accounts eventually became substantial, since he deposited into them the........