Do you have to report EVERY PENNY that goes into your bank account?

[Brookleneze]

This is a question that I had for a long time:

Do the banks tell the IRS about every amount of money that goes into my checking account?
Many times I deposit cash into my bank account to cover cc expenses that were for friends/family, can I get in trouble for doing that?

Also I want to open a Chase bank account and want to avoid the monthly fee so I want to deposit cash to maintain that minimum.

Also I have some cash sitting at home (about $5.000) and would like to put it in the bank but only if I don't have to report it. If ultimately I don't report it, will the IRS ever look and see that there was an unreported amount?

What are the general rules about all of this?

[whYME]

I know if you deposit $10,000 or more in cash at once they need to report it.
other than that I'm not sure...

[BAHayman]

I know if you deposit $10,000 or more in cash at once they need to report it.
other than that I'm not sure...

+1, although few know that it is also for withdrawals of $10,000 or more. See FinCEN Form 104.

Also as an FYI, if you ask a banker if the transaction is going to be reported, then even if you decide not to go forward with the transaction the banker must file a SAR (Suspicious activity report).

[Brookleneze]

How about less than $10.000?
How about cumulative increments exceeding $10.000, in a long/short time span?

[BAHayman]

How about less than $10.000?

Less then $10,000 can technically be reported on a SAR but they would need a reason as to why it is suspicious...

How about cumulative increments exceeding $10.000, in a long/short time span?

Multiple transactions must be treated as a single transaction if the financial institution has knowledge that (1) they are by or on behalf of the same person, and (2) they result in either currency received (Cash In) or currency disbursed (Cash Out) by the financial institution totaling more than $10,000 during any one business day.  For a bank, a business day is the day on which transactions are routinely posted to customers’ accounts, as normally communicated to depository customers.  For all other financial institutions, a business day is a calendar day.

Disclaimer: Don't take my word for any of this...

[Side incomer]

How about less than $10.000?
How about cumulative increments exceeding $10.000, in a long/short time span?

Officially it's within 2 weeks timeframe.
There has been a lot of threads online about this. just google it.

[whYME]

+1, although few know that it is also for withdrawals of $10,000 or more. See FinCEN Form 104.

Yeah, I meant to mention that...

[Redbull3]

I could be wrong but this is what I think.

CTRs and SARs are not for IRS purposes. Banks are worried about money laundering, not tax evasion.

If the IRS determines you owe them money then they can do things like freeze your assets in accounts in your name. But there is no front-end reporting on your deposits.

At the end of every calendar year, banks will send you an interest income report on the amount you made in interest on your account. This is a (legally mandated) courtesy for you so YOU can report the interest. But this has nothing to do with deposits and withdrawals.

I work for a bank and this is my understanding. I could be wrong.

[BAHayman]

I could be wrong but this is what I think.

CTRs and SARs are not for IRS purposes. Banks are worried about money laundering, not tax evasion.

If the IRS determines you owe them money then they can do things like freeze your assets in accounts in your name. But there is no front-end reporting on your deposits.

At the end of every calendar year, banks will send you an interest income report on the amount you made in interest on your account. This is a (legally mandated) courtesy for you so YOU can report the interest. But this has nothing to do with deposits and withdrawals.

I work for a bank and this is my understanding. I could be wrong.

True that the CTRs and SARs are not sent to the IRS, but FinCEN is still an agency of the Treasury Department with which the IRS has its reaches... I could be wrong, but I'd imagine that it would be harder for the IRS to look in to personal bank accounts and/or freeze assets (court orders?) then it would be for them to look if any CTRs have been filed (which would give them cause to look in to assets...).

[whYME]

CTRs and SARs are not for IRS purposes. Banks are worried about money laundering, not tax evasion.

I assumed that was the case. however, IIRC, when I did it once the bank manager told me he had to report it to the IRS... (although it's possible he just said "the government" or something like that and my brain translated that to IRS)

[HelpMe]

CTR’s and SAR’s are not a big thing unless you are doing something illegal. Many of us during the Mint run would make deposits >10k a couple times a week. I am sure many CTR’s and SAR’s were filed and nothing ever came of them.

[Brookleneze]

+1, although few know that it is also for withdrawals of $10,000 or more.

Is an online CC payment considered a withdrawal?

Officially it's within 2 weeks timeframe.

You mean this statement is incorrect?

(2) they result in either currency received (Cash In) or currency disbursed (Cash Out) by the financial institution totaling more than $10,000 during any one business day.

But there is no front-end reporting on your deposits.

But do you think the IRS snoops around into Joe Shmoe's poor account?

At the end of every calendar year, banks will send you an interest income report on the amount you made in interest on your account. This is a (legally mandated) courtesy for you so YOU can report the interest. But this has nothing to do with deposits and withdrawals.

This only applies to savings account and not checking, right?

[BAHayman]

Is an online CC payment considered a withdrawal?

Can't see why it wouldn't be... But like it was mentioned above, the average joe has nothing to worry about. see Redbull3's answer below.

This only applies to savings account and not checking, right?

It would also apply for an interest checking account, or a checking account for which you received a sign up bonus etc.
 

At the end of every calendar year, banks will send you an interest income report on the amount you made in interest on your account. This is a (legally mandated) courtesy for you so YOU can report the interest. But this has nothing to do with deposits and withdrawals.

That is also furnished to the IRS, correct?

[HelpMe]

That is also furnished to the IRS, correct?

Correct. Also for amounts under 10.00 they are not required to issue a 1099.

[Name Changed]

Also I have some cash sitting at home (about $5.000) and would like to put it in the bank but only if I don't have to report it. If ultimately I don't report it, will the IRS ever look and see that there was an unreported amount?

Why put it in a bank - if you were to get audited this would make trouble for you.

What you could do - is make the money into a bank check under your name. This way it is more secure than cash, but its not like there is money in your account.

[Saver2000]

Why put it in a bank - if you were to get audited this would make trouble for you.

What you could do - is make the money into a bank check under your name. This way it is more secure than cash, but its not like there is money in your account.

. . . And renew the bank check every 6 months? I sure hope his bank doesn't charge for bank checks. 

If you have any cc's that you don't use (even it has very small cl) you can "prepay" it, and then request a check when you want the money.

[Redbull3]

Is an online CC payment considered a withdrawal?

No. This has to do with cash going in and out. A CC payment has nothing to do with cash. You are paying for items already purchased with a credit card, so there is no concern of money laundering here.
To illustrate, official bank checks for 10K+ (even though they are "as good as cash") do NOT cause CTR events. Why? Because the checks only have value after they are taken to another bank and cashed or deposited. So it is money from within the banking system not LEAVING the banking system. Only money LEAVING the banking system gets tracked.

[Redbull3]

Why put it in a bank - if you were to get audited this would make trouble for you.

What you could do - is make the money into a bank check under your name. This way it is more secure than cash, but its not like there is money in your account.

Bank checks can only be created by withdrawing an amount ALREADY in an account. You would have to deposit cash first, then create a bank check.

[Saver2000]

Bank checks can only be created by withdrawing an amount ALREADY in an account. You would have to deposit cash first, then create a bank check.

Incorrect.  I've done it many times at chase bank using cash in hand.

[Name Changed]

Incorrect.  I've done it many times at chase bank using cash in hand.

+1 Also do so

. . . And renew the bank check every 6 months? I sure hope his bank doesn't charge for bank checks.   

So banks offer for free - I think Chase (you have to maybe have the premiere account to get it for free) Here