The IRS is demanding a Boston woman pay more than $2 million in penalties over a multimillion-dollar endowment she received from her father, who fled Nazi Germany in the 1930s, Reason reports.
Monica Toth, 82, was born in Buenos Aires, Argentina, after her family left Germany due to Jewish persecution. Toth later moved to the United States and became a naturalized citizen in 1980.
Her father opened a Swiss bank account in her name shortly before his death in 1999, which contained about $4.2 million. According to the Bank Secrecy Act of 1970, any U.S. citizens that have over $10,000 in a foreign bank account must submit an annual Report of Foreign Bank and Financial Accounts, something that Toth says she was unaware of for several years.
Toth disclosed the account to the IRS after learning of the rule in 2010. The agency subsequently conducted an audit and Toth ended up paying $40,000 in penalties. However, the IRS later accused her of "reckless" and "willful" violation of the law and demanded that she pay the maximum civil penalty, which amounts to about $2 million or 50% of the bank account’s total.
Toth, with support from the libertarian nonprofit Institute for Justice, is calling on the U.S. Supreme Court to overrule the penalty, arguing that it violates the Eighth Amendment’s protections against excessive fines, though the U.S. argues that because this was a "civic penalty," the Eighth Amendment’s protections do not apply.
Theodore Bunker ✉
Theodore Bunker, a Newsmax writer, has more than a decade covering news, media, and politics.
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