How much money can you put in the bank without getting tax?If you was given a casheres check for $80,000. How can you put it in the bank without getting tax? Should you tell the investor who is giving you the money to break it down to you in checks of $5000 so you can put it in once a week or should you put your money in different banks? If you put the whole $80,000 in... | |
Having worked in the banking industry I can guarantee you of several things:
1. Breaking up a large cash transaction into a series of smaller cash transactions (cashier's checks are considered to be CASH) will not avoid the CTR filing requirement. Aggregate transactions will get you busted here -- that's what caught Eliot Spitzer out.
2. The person buying the cashier's checks will have a CTR filed on the aggregate transactions as well.
3. Making a series of deposits that is out of character with your normal banking practices WILL trigger a Suspicious Activity Report. And given the size of the deposits that you are contemplating, I can assure you that this would get the interest of law enforcement on several levels.
4. The person buying the cashier's checks will also be looking at a SAR if this departs from their normal banking practices.
If this is all innocent and legitimate you have nothing to fear from the reporting requirements. However if you're trying to evade taxes illegally, you'd leaving an audit trail that glows like a searchlight in the nighttime sky. That would be well beyond stupid, IMHO. And making something innocent look suspicious isn't much smarter either.
Getting a check from an investor and putting the whole check in the bank will not trigger taxes. What will trigger taxes is that at the beginning of next year, you will receive a 1099-S which will show the investments that you sold and those have to be reported on a schedule D of your tax return. You will need the date that the stock was sold and also the date it was purchased, including the full purchase price with the commission paid. You will only pay tax on the difference. In addition, if you had losses as well as gains, those could be offset.
By itself, putting money in the bank does not trigger tax. We tax income. If you already had the $80,000 and had already paid taxes on it, sticking it in the bank is not going to generate income.
Depending on the source of the money, it could be income to you. Was it a payment for services? Lottery winning? Capital gain from sale of something? If so, then it was income. Was it paid to you to purchase something you were selling? If so, it's not income except with respect to any gain on the sale of the property (which you would determine by comparing the $80,000 to its cost basis, which is typically the amount you paid for the property). Was it a loan advance that you have to repay with interest? If so, it's not income to you. Was it a gift? If so, it's not income to you (more precisely, it is income, but is exempt from tax), but could trigger gift taxes that must be paid by the giver.
If you're trying to evade paying tax you might owe, I would recommend you just give it up. The IRS has broad powers to track down the source of your deposits, and they can attach your bank account if they need to in order to collect tax. You can't avoid that.
You don't get taxed on money you put in the bank. If it makes interest, you get taxed on that. If it's for some kind of work you did, you get taxed on the money you made. But you refer to an investor - if they are investing in a business you are or will be running, you aren't taxed on what they put in. What counts for tax depends on what the money is for, and you don't mention that.
break it down and put it in several different bank
