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What regulations govern use of safe deposit boxes? Is it necessary to reveal the contents of a safe deposit box?
Optional Information: State/Country relating to Question: North Carolina
Hello,This depends on the situation. Can you please tell me a little about the matter at hand?
My wife and I are seniors without health insurance and I am concerned that if one of us had a serious illness we would lose what little savings we have. Can we put cash in a safe deposit box to "hide" it or would that be illegal?
Thank you for your follow up.There is nothing illegal about putting cash into your deposit box. By law you are to declare to the IRS your income of course, and should you be sued and have a judgment against you, whatever is in the box may be liable to be attached as part of judgment (not taking into consideration homestead laws).But there is nothing unlawful about storing cash in a deposit box - it is perfectly legal in itself to do so.I hope you found my answer helpful, and if so please do not forget to click ACCEPT. This is the only way for me to get credit for my work – I receive no credit for my time with you unless you actually press ACCEPT, even if you already have a subscription. If you need more information, please use the REPLY button and I’d be more than happy to answer to your satisfaction. There is no fee for follow up questions before or after accepting, if we continue the conversation. If you feel that I went an extra step to help you, a bonus in the form of another accept or an “add on” (available after you accept) is truly appreciated.
Experience: Fully licensed attorney in Texas in private practice.
From your answer I assume that putting cash in a safe deposit box does not really "hide" it. Does that mean that I would have to report that I have a safe deposit box and what the contents are?
Hello,Hide it depends from who? You have to disclose your earnings to the IRS. But you do not have to tell the IRS where you store it.As for creditors, if they sue you, and if they get judgment, they may file a post-judgment discovery to ask you about your assets (so they can seize as much as they can for judgment). If you do not mention the box, they would not know unless they have a forensic accountant or unless they subpoena the bank specifically looking for anything you avoided telling them...Defendants in your situation who may want to avoid creditors finding the box normally keep the box in a bank that is separate from their checking/saving accounts, so that that bank with the box has less chance of falling under scrutiny from the creditors at time of post-judgment discovery unless Defendants specifically tell them about the bank that has the deposit box.Note that failure to list the box on any discovery for finances after judgment may be contempt of court, however.I hope you found my answer helpful, and if so please do not forget to click ACCEPT. This is the only way for me to get credit for my work – I receive no credit for my time with you unless you actually press ACCEPT, even if you already have a subscription. If you need more information, please use the REPLY button and I’d be more than happy to answer to your satisfaction. There is no fee for follow up questions before or after accepting, if we continue the conversation. If you feel that I went an extra step to help you, a bonus in the form of another accept or an “add on” (available after you accept) is truly appreciated.