The US Court of Appeals for the Eleventh Circuit (the Court) has held that penalties of USD100,000 imposed on a taxpayer for failing to declare foreign accounts containing USD16,000 or less were 'disproportionate and excessive' under the eighth amendment to the US constitution.
The Court remanded the case back to the district court to determine the effect of the required USD300,000 penalties reduction, though it upheld heavy penalties on significantly larger accounts. The opinion creates a split between two different US circuit appeal courts, making a supreme court review more likely.