Closing procedures typically vary depending on the results of the examination. In all cases, the examiner will support the determination in a summary memorandum with references to the underlying work papers. The summary memorandum normally shows all years opened and the determination reached for each year. If several years are opened but a penalty is asserted only with respect to one year, the summary memorandum should provide an appropriate explanation. There are however different closing procedures depending on whether there is no violation, a violation without penalty, negligence or a non-willful violation, a willful violation, or a referral to Criminal Investigation.
If no FBAR violation is found, the examiner will complete a summary memorandum and FBAR monitoring document then close the FBAR case file to the group manager. The group manager will review the FBAR case file for both technical and procedural issues and note this on the activity record. In some instances the examiner may, after discussion with the group manager, issue an FBAR Warning letter, Letter 3800, if there is a violation of the FBAR requirements but no penalty is being asserted. This occurs when the examiner determines that there was a violation but that penalties are not warranted in view of the facts and circumstances of the case.
If the examiner, after discussion with the group manager, determines that it is appropriate to assert an FBAR penalty and that a referral to Criminal Investigation is not appropriate or has been declined, the examiner will assert penalties in accordance with the FBAR penalty guidelines. Once the penalties have been determined and just before the examiner is ready to issue Letter 3709, the FBAR 30 Day Letter, and Form 13449, FBAR Agreement to Assessment and Collection, the examiner will submit the FBAR case file to an FBAR Coordinator. Counsel will then render its legal advice. After the Counsel review has been received and agreed that penalties are appropriate, the examiner will: 1) Issue Letter 3709, the FBAR 30 day letter; 2) Transmit with Letter 3709 the Form 13449, FBAR Agreement to Assessment and Collection; and 3) Provide the customer Notice 1330, Information on Making FBAR Penalty Payment by Check, and retain a copy in the file.
If an FBAR penalty is proposed but not agreed to, the examiner waits 45 days to see if the person will appeal as provided in Letter 3709. In order to appeal, the person against whom an FBAR penalty is proposed must mail a written protest in duplicate to the examiner that is postmarked before the designated response date, which is listed in the Letter 3709. An appeal requires 180 days remaining on the assessment statute of limitations. If there is no response from the person against whom an FBAR penalty is proposed, the penalty is assessed and the collection process begins. If the person apparently violating the FBAR requirements appeals and there is no related Title 26 case or the related Title 26 case is agreed, the examiner will then ensure that any documents needed in any related cases or in the FBAR case are copied so that there is a fully documented case file for each and note on the Transmittal Letter that the case is an FBAR category case in the Appeals Coordinated Issue (ACI) Program.
