Many small business owners are totally unaware that they are breaking the law when they take cash payments over $10,000. What they do not know may cost them enormous fines from the IRS. Under IRS rules, if a business accepts a cash payment of $10,000 or more for a single transaction, they must report it by filing a form 8300 within 15 days of the transaction. This form can be filed online or on paper. Additionally, the business must notify the individual from whom they admitted the payment no later than January 31 of the year after the filing.
The penalties for not filing could be huge. The intentional disregard penalty for failure to report is the higher of $25,000 or the quantity of money received in this transaction to not exceed $100,000. Failure to submit a timely return may run $50 to $100 per transaction. The aggregate annual limitation (ceiling) in the case of businesses with gross receipts exceeding $5 million is $1,500,000. For businesses with gross receipts not exceeding $5 million, the aggregate yearly limitation is $500,000.
Breaking a transaction into two payments does not enable you to avoid filing. The IRS counts greater than one payment related to one transaction as still being subject to the $10,000 limitation. By way of instance, if a business sold a tractor and received a $7,000 cash deposit on the order, delivered the Highway some time later and got the $5,000 balance as money, 소액결제 현금화 후기 which would be counted as a $12,000 transaction and requires that the filing of a form 8300. It is not required to report transactions using cashiers checks or money orders, but any form of money or coin is subject to the limitations.
If a business sells a client a product for $9,000 cash one month and a month later the same customer purchases a totally different thing for money, that’s considered two separate transactions and not subject to filing. However, if the 2 sales happened inside a 24 hour period they would be subject to the limitation. If a business leases a room to someone who pays $2,000 a month rent in money and the total cash rent paid during a calendar year exceeds $10,000, then that is subject to the limitation since it’s all related to one transaction.
It gets fairly tricky sometimes to ascertain if the limit has been exceeded. When in doubt consult with your accountant or the IRS website for additional definition, or you may call the IRS for information. Form 8300 is available online or wherever you get IRS forms. It can also be filed electronically on line. Take care to always report these transactions within 15 days.