About a year ago, I received a call from a business owner and his accountant. They wanted information about some large cash payments the business had received 18 months prior, and they thought I could help them out. I immediately shut down the conversation and insisted they come to my office if they wanted to discuss this matter with me. What they were discussing possibly involved illegal activity regarding Form 8300, which is not something you want to talk about in mixed company. Federal law requires all cash payments more than $10,000 must be reported to the IRS with Form 8300. This form must also be filed within 15 days after the date of the cash transaction. It must include the name, address, and TIN of the person from whom the cash was received, something the business owner had failed to do. After filing, you must furnish a written statement to each person from whom the cash was received. You must provide that statement on or before Jan. 31 of the year following the calendar year for which you filed Form 8300. It is also important to note the definition of "cash" includes cashier’s checks, bank drafts, traveler's checks, and money orders.
Failing to file Form 8300 may result in civil penalties, which can amount to millions of dollars and criminal penalties, which can include fines and prison time. Normally, criminal penalties apply to those who attempt to structure a transaction in such a way that it would seem unnecessary to file Form 8300. You are never allowed to help a customer structure a transaction to avoid the Form 8300 reporting requirement. Cash payments can cause big problems if they are handled carelessly. Often, compliances are hard to understand. When in doubt, get advice. Call the Law Office of Steven H. Leahy at (312) 664-6649 for all Form 8300 questions.
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