If you fail to report foreign work activity within the time limit, penalty deductions may be imposed as follows:
For the first time you fail to file the report, a penalty of one month's benefit is withheld, even if you may have worked several months before we discovered your failure to report;
For the second time you fail to file the report, a penalty of two months' benefits may be imposed; and
For the third and subsequent times you fail to file the report, three additional months' benefits may be withheld.
The above penalties are imposed in addition to the monthly benefits you lose because of the application of the foreign work test. We cannot impose any more penalty deductions than the number of months for which foreign work deductions were required for that year.