Taxpayer Loses Appeal in $3 Million Foreign Reporting Dispute

A taxpayer fighting a $3 million tax bill for failing to report her Swiss Bank account failed to convince an appeals court that the penalties were improper.

Monica Toth, a U.S. citizen, established a Swiss bank account in 1999, and didn’t report the account to the IRS until 2010. The IRS determined that Toth willfully failed to file a Foreign Bank and Financial Accounts, or FBAR, form for 2007. Toth was issued a civil penalty of $2.1 million—the maximum allowable penalty—reflecting half the value of Toth’s Swiss bank account.

When Toth failed to pay the ...