Bio photo for Paul Sisolak" />Learn the laws and bank rules for depositing more than $10,000 in cash. Find out whether these transactions will be reported to the IRS for suspicious activity.
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For some fortunate reason, you find yourself with $10,000 just sitting there, burning a hole in your pocket. Now you face the decision of whether to spend it or save it. Opting for the sensible choice, you decide to deposit the entire amount at the bank, either in cash or by check. However, it's not as straightforward as it seems. Your money is now on hold, and the IRS has been notified. But don't let that intimidate you. It doesn't mean you've committed a financial crime. You're simply trying to put your money in the bank, which is ideally allowed, regardless of the amount. Banks are vigilant about potential bank fraud or suspicious activity, and $10,000 is a significant threshold that attracts attention. While the concern is sometimes warranted, there are instances where depositors can inadvertently get into trouble if they don't handle large deposits correctly. If you plan on depositing more than $10,000 in cash, it's advisable to learn more about the Bank Secrecy Act and other relevant regulations. Additionally, you may want to explore whether there are any differences if you deposit the same amount in the form of a check. It’s called the Bank Secrecy Act (aka. The $10,000 Rule), and while that might seem like a big secret to you right now, it’s important to know about this law if you’re looking to make a large bank deposit over five figures. The Bank Secrecy Act, officially called the Currency and Foreign Transactions Reporting Act, started in 1970. It states that banks must report any deposits (and withdrawals, for that matter) that they receive over $10,000 to the Internal Revenue Service. For this, they’ll fill out IRS Form 8300. This begins the process of Currency Transaction Reporting (CTR). Essentially, any transaction you make exceeding $10,000 requires your bank or credit union to report it to the government within 15 days of receiving it -- not because they’re necessarily wary of you, but because large amounts of money changing hands could indicate possible illegal activity. This includes theft, money laundering, or helping fund criminal organizations or terrorists. Your bank must cover its bases for any large “reportable transaction” that passes through. Note: Private businesses must go through a similar reporting process if a customer makes a large, big-ticket purchase, cash only, like a car, a house, or other major amenities.
