The IRS Could
Cease Your Smallbiz Bank Account
In their efforts to combat money laundering
congress included a stipulation in the Small Business
Jobs and Credit Act of 2010 that required businesses to
furnish Form 8300 beginning on or after January 1, 2011.
laundering is a tool that assists many individuals who
participate in various criminal activities, ranging from tax
evasion to terrorist financing to drug dealing, to hide the
proceeds from their illegal activities.
The law stiuplates that
any person who
receives more than $10,000 in
cash in one
transaction or two or more related transactions
their trade or business must file a Form 8300.
The law also requires the
institution that receives a
deposit of more
than $10,000 to submit a Currency Transaction Report to the
transfer does not constitute cash for Form 8300 reporting.
A cashierís check, bank draft, travelerís check, or money
order with a face amount of more than $10,000 is not treated
as cash and a business does not have to file Form 8300 when
it receives them
lease payments constitute payments on the same transaction
(the leasing of the cab). Accordingly, the taxi company is
required to file Form 8300 when the total amount exceeds
$10,000. Each time the payments aggregate in excess of
$10,000 the taxi company must file another Form 8300 within
15 days of the payment that causes the additional payments
to total more than $10,000.
organizations do not need to report the receipt of cash
donations over $10,000 because an exempt organization is
not, in carrying out its exempt function, considered in the
definition of a trade or business under IRC section 162.
and unrelated payments does not warrant Form 8300.
A business must file Form 8300 within 15 days after the date
the cash was received. If there are subsequent payments that
are made with respect to a single transaction (or two or
more related transactions), the business should file the
form 8300 when the total amount paid exceeds $10,000. Each
time the payments aggregate in excess of $10,000 the
business must file another Form 8300 within 15 days of the
payment that causes the additional payments to total more
A business must notify its customer, in writing, by January
31 of the subsequent calendar year.
A business is only required to provide a statement to
individuals if the filing of the Form 8300 is required.
A business is prohibited from informing the
buyer that the suspicious transaction box was checked.
There are penalties for not filing in a timely manner or for
failing to furnish a statement to the persons whose names
were required to be included in the form.
Penalties for not filing in a timely manner includes, fines
of $100 per incident.
Businesses with gross receipts of $5,000,000 or less
could pay up to $500,000 within a 12 month period.
Businesses with gross receipts exceeding $5,000,000
could pay $1,500,000 within a 12 month period.
For intentionally disregarding the requirement to
file in a timely manner businesses could pay the greater of
$25,000 or the amount of cash ereceived in such transaction
not to exceed $100,000.
If you fail
to furnish a statement to the persons whose names were
required to be included in the form the penalty is $100 per
violation. The aggregate annual limitation has been raised
from $1,500,000. In the case of a business having gross
receipts not more than $5 million, the aggregate annual
limitation is $500,000.
You can file Form 8300 at the IRS
Electronic Filing (E-Filing) System
on this subject.
Learn more by visiting the
IRS Form 8300 FAQ page.
Form 8300 and Reporting Cash Payments
The IRS Form 8300 FAQ page
The IRS Form 8300 Penalties page