Federal law requires a person to report cash transactions (or “cash payments”) of more than $10,000 to the IRS. Here are some facts from the IRS about reporting these payments. (Note: Despite the source of this advice is the IRS, always check with your professional advisor on issues related to your taxes and finance. Each small business owner can have unique circumstances.)
What is the technical definition of “cash”?
Cash includes coins and currency of the United States or any foreign country. For some transactions, it’s also a cashier’s check, bank draft, traveler’s check or money order with a face amount of $10,000 or less.
Who (or what) may need to know this information?
For purposes of cash payments, a “person” is defined as an individual, company, corporation, partnership, association, trust or estate. For example:
- Dealers of jewelry, furniture, boats, aircraft, automobiles, art, rugs and antiques
- Real estate brokers
- Insurance companies
- Travel agencies
How do you report a cash payment?
People report the payment by filing Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. A person can file Form 8300 electronically using the Financial Crimes Enforcement Network’s BSA E-Filing System. E-filing is free, quick and secure. Filers will receive an electronic acknowledgement of each form they file. Those who prefer to mail Form 8300 can send it to the IRS at the address listed on the form.
A person must report a cash of more than $10,000 they receive…
- In one lump sum
- In two or more related payments within 24 hours
- As part of a single transaction within 12 months
- As part of two or more related transactions within 12 months
When must a person file a cash payment with the IRS?
A person must file Form 8300 within 15 days after the date they received the cash. If they receive payments toward a single transaction or two or more related transactions, they file when the total amount paid exceeds $10,000.
More information from the IRS:
- Publication 1544 |Reporting Cash Payments of Over $10,000
- IRS Form 8300 Reference Guide
- Guidance for the Insurance Industry on Filing Form 8300
- Form 8300 and Reporting Cash Payments of Over $10,000
- Fact sheet: Cash payment report helps government combat money launderin
IRS Form 8300 Assistance | Call 866-270-0733 (toll-free inside the U.S.) Monday – Friday, 8 a.m. to 4:30 p.m. Eastern for help in completing Form 8300 (PDF). The form is available online at IRS.gov Form 8300 (PDF) or by calling 800-829-3676. Questions regarding Form 8300 can be sent to [email protected].