Is my CPA liable for my FBAR penalties?

[dalon]

I am a UK citizen and US Legal Permanent Resident since July 2009. For 2009 My CPA told me I didn't have to list the bank interest received from my overseas savings on my 1040.

I now believe that information to be incorrect and it appears that I am now in violation of not having filed an informational FBAR to the Treasury. My CPA never told me about this filing requirement. Because I didn't correctly report all my income it appears that I am not eligible to simply file an amended return 1040X / and delinquent FBAR, but must now go through Voluntary Disclosure and face penalties of 12.5% of my foreign accounts (about $5000).

At the time that we discussed the information that I needed to give him for my 2009 return, I asked him about bank interest and he told me that as it was so small ($200 or so) that it didn't need to be reported.

What recourse do I have in holding my CPA liable? Surely this is malpractice and he should deal with this for me and pay all penalties? Surely malpractice insurance, errors and omissions professional insurance should cover my penalties??

For 2009 I had no US -sourced income and I had zero tax to pay.

[arvad]

You should prepare an amended return to report the interest income.
As the other answer stated, file the 2009 and 2010 FBAR as soon as possible. I would state that you discussed the filing with an expert CPA and they told you you did not need to file the forms. It wouldn't hurt to state that you took it upon yourself to research the filing requirement when you heard information that led you to believe that you were given bad advice.
I would file a complaint with the state CPA licensing division and the state society of CPA's to have this individual investigated. His advice led you to a situation where you were not complying with the law and could cost you penalties.

[choviohoya]

If your foreign accounts have $40K in them, then file the FBAR for 2010 and 2009 NOW.
Attach a letter stating that you are freshly minted resident and didn't know until reading papers that you had a filing requirement.

The bank interest should have been reported if you had a filing requirement.

[siuaghan]

if he gave you bad advice, of course, confront him with it, but whether you get any satisfaction is another thing