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Good morning. I certainly understand the situation and your concern. This is actually a requirement that the business must comply with, per the IRS and have provide the explanation and reason/requirements below, for your review.
Who must file Form 8300?
Any persons who receive more than $10,000 in one transaction or a series of related transactions, while conducting their trade or business, must file a Form 8300.
What payments must be reported?
A business must file Form 8300 to report cash paid to it if the cash payment is:
One lump sum of over $10,000,
Two or more related payments that total in excess of $10,000, or
Payments received as part of a single transaction (or two or more related transactions) that cause the total cash received within a 12-month period to total more than $10,000.
Received in the course of trade or business,
Received from the same payer (or agent), and
Received in a single transaction or in two or more related transactions.
What is the definition of a transaction?
A transaction is the underlying event resulting in the transfer of cash. Examples include:
Sale of goods, services or real or intangible property
Rental of goods or real or personal property
Cash exchanged for other cash
Establishment, maintenance of or contribution to a trust or escrow account
A loan repayment
Conversion of cash to a negotiable instrument such as a check or a bond
What is a related transaction?
There are two types of related transactions:
Transactions between a buyer, or agent of the buyer, and a seller that occur within a 24-hour period are related transactions.
In addition, transactions more than 24 hours apart are related if the recipient of the cash knows, or has reason to know, that each transaction is one of a series of connected transactions.
Does the 24-hour period mean one day such as all day Tuesday or does it mean literally 24 hours such as from 11 am on Tuesday to 11 am on Wednesday?
A 24-hour period is 24 hours, not necessarily a calendar day or banking day.
What does “cash” mean for the purposes of Form 8300?
For purposes of Form 8300:
Cash is money. It is currency and coins of the United States and any other country.
Cash is also certain monetary instruments - a cashier’s check, bank draft, traveler’s check, or money order - if it has a face amount of $10,000 or less and the business receives it in:
A “designated reporting transaction” as defined in Treas. Reg. section 1.6050I-1(c)(iii) (generally, a retail sale of a consumer durable, a collectible, a travel or entertainment activity) or
Any transaction in which the recipient knows the payer is trying to avoid the reporting of the transaction on Form 8300.
What is a designated reporting transaction?
Generally, a designated reporting transaction is the retail sale of any of the following:
A consumer durable, such as an automobile or boat. Property is generally a consumer durable if it is tangible personal property (not real or intangible property) that:
Is generally suited for personal use,
Is expected to last at least one year under ordinary use, and
Has a sale price of more than $10,000.
A collectible (such as a work of art, rug, antique, metal, gem, stamp, or coin)
An item of travel and entertainment (if the total sales price of all items for the same trip or entertainment event is more than $10,000).
If an item (an automobile, for example) sells for $9,950 but the buyer pays $10,650 (sales price plus state and local taxes). Would this be considered a designated reporting transaction (retail sale of a consumer durable) requiring the definition of cash to be expanded to include monetary instruments?
No. In determining a designated reporting transaction, a consumer durable is defined as tangible personal property that is generally suited for personal use, is expected to last at least one year under ordinary use, and has a sale price of more than $10,000 (exclusive of sales tax). If the sales price is less than $10,000, then the tangible personal property would not be a consumer durable regardless of any taxes.
Does a wholesaler report transactions paid in US (or foreign) coins and currency only?
Yes, if the wholesaler receives payment in the form of coins or currency. A wholesaler would rarely have a designated reporting transaction and therefore, need not report transactions paid with cashier’s checks, bank drafts, traveler’s checks or money orders.
What if a retailer also does some wholesale transactions, would the expanded definition of cash only apply to its retail sales?
No. If the trade or business of the seller principally consists of sales to ultimate consumers, then all sales, including wholesale transactions, are considered “retail sales”.
Is a personal check considered cash for reporting on Form 8300?
No. Personal checks are not considered cash.
Would a mobile home be classified as personal or real property for purposes of filing Form 8300?
Personal property. A mobile home qualifies as personal property and a consumable durable for determining any required Form 8300 reporting, regardless of how the purchaser intends to use or ultimately uses the mobile home.
When is the Form 8300 due?
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 than $10,000.
Form 8300 requires providing the Taxpayer Identification Number (TIN) of the person providing the cash. If the business is unable to obtain the Taxpayer Identification Number of a customer making a cash payment of over $10,000, should the business file Form 8300 anyway?
Yes, to fail to file the Form 8300 is prohibited in this situation. However a filer may be able to avoid penalties when the customer refuses to provide a TIN by showing that its failure to file is reasonable under circumstances more fully described in 26 CFR(NNN) NNN-NNNN1(e). At a minimum:
The business should request the TIN at the time of the transaction. If the person providing the cash refuses to provide the TIN, the business should inform the person required to provide the TIN that he or she is subject to a $50 penalty imposed by the Internal Revenue Service under section 6723 [26 USCS § 6723] if he or she fails to furnish his or her TIN;
Maintain contemporaneous records showing the solicitation was properly made and provide such contemporaneous records to IRS upon request,
Accompany the incomplete filed Form by a statement explaining why the TIN is not included.
If a TIN is not received as a result of the initial solicitation (at the time of the transaction) the first annual solicitation must be made on or before December 31 of the year in which the account was opened (transaction occurred) or January 31 of the following year for accounts opened in the preceding December following the same procedures.
How can a business get Form 8300?
You can obtain copies of IRS/FinCEN Form 8300 by:
Calling the IRS forms line at(NNN) NNN-NNNN
Downloading from IRS.gov the Form 8300 in English (PDF) or Spanish (PDF)
Visiting the FinCEN Web site
Are there any publications that will help with filing Form 8300?
Yes. Publication 1544, Reporting Cash Payments of Over $10,000 (Received in a Trade or Business) explains why, when, and where to file Form 8300. It also explains key issues and terms related to Form 8300. You can obtain copies of Publication 1544 by:
Calling the IRS forms line at(NNN) NNN-NNNNor
Downloading from IRS.gov Publication 1544 in English (PDF) or Spanish (PDF).
Where does a business file Form 8300?
There are two permissible alternative methods for filing Form 8300. Form 8300 can be mailed to:
Internal Revenue Service
Detroit Computing Center
P.O. Box 32621
Detroit, MI 48232
or Form 8300 can be filed electronically through the Financial Crimes Enforcement Network. See FAQ 18 below.
Can Form 8300 be filed electronically?
Yes. On Sept 19, 2012, FinCEN announced that businesses are now able to electronically file their Form 8300 using the Bank Secrecy Act (BSA) Electronic Filing (E-Filing) System. E-filing is free, and is a quick and secure way for individuals to file their Form 8300s. Filers will receive an electronic acknowledgment of each submission. For more information about Form 8300 e-filing, read the FinCEN news release.
How can a filer confirm that a filed Form 8300 was received by IRS?
If filed electronically, the filer will receive an acknowledgment confirming receipt. If Form 8300 is mailed, the filer can confirm IRS received the form by:
Sending the form via certified mail with return receipt requested or
Calling the Detroit Computing Center at(NNN) NNN-NNNN
If a customer (the buyer) about whom the Form 8300 was filed wants a copy of the form, they must contact the filer.
Does the IRS have an email address to send questions regarding Form 8300?
Questions concerning Form 8300 may be submitted [email protected]
This email system will not accept actual Forms 8300.
Written Statement to Customer:
Must a business notify its customer that the business has filed a Form 8300 regarding the cash transaction with the customer?
Yes, a business must notify its customer, in writing, by January 31 of the subsequent calendar year.
If a business filed a Form 8300 on an individual and checked the suspicious transaction box and an 8300 report was not required, does the business have to inform the individual by January 31 about the fact that it filed Form 8300?
No, because reporting of the suspicious transaction in this instance is voluntary. 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.
Instead of sending the customer a separate notification letter, can the dealership use the sales invoice as the notification requirement, if the sales invoice has language printed on it that the IRS will be furnished with information for cash sales over $10,000?
There is nothing in the code or regulations mandating a specific format for the customer statement. The regulations, however, establish certain minimum requirements:
The statement notifying the payer must be in the form of a single, annual, written statement of the aggregate value of all transactions required to be reported on the Form 8300 during the previous year. The statement may only be furnished during January of the following year, not at the time of the reported transaction. Furthermore the statement must be a single statement aggregating the value of the prior year transactions. Furnishing copies of various invoices does not meet the requirement of furnishing a single statement of the total aggregate value of the transactions.
If there was only one transaction during the year and the business furnished a copy of the invoice in January of the following year it would meet the statement requirements if the seller chose to print the required language on an invoice Treasury Regulation section 1.6050I-1(f)(2) states:
Form of statement. The statement required by the preceding paragraph need not follow any particular format, but it must contain the following information:
The name and address of the person making the return;
The aggregate amount of reportable cash, received by the person who filed the Form 8300 during the calendar year, in all related cash transactions; and
A legend stating that the information contained in the statement is being reported to the Internal Revenue Service.
Can a copy of the Form 8300 be given to the customer as a written notice?
Yes, if the business filed only one Form 8300 for the identified person during that calendar year at issue. . Because the single Form 8300 contains the name, address, contact telephone number of the filer, the aggregate amount of reportable cash received (since there is only one transaction, or series of related transactions, the one Form represents the entire aggregate transactions) and informs the notice that the payment(s) are being reported to the IRS, the Form 8300 would be acceptable as written notification. However, if during the calendar year, the filer has transactions with the noticee which were included on more than one Form 8300, furnishing copies to the notice of multiple Forms 8300 does not meet the notice requirement because it is not a “single” statement. In this situation, the Form 8300 filer should provide a single written notice for all of the transactions. It should be noted that while the practice of using a copy of the Form 8300 as a notice may be convenient, it may not be advisable because of the sensitive information contained on the form; for example, Employer Identification Number or Social Security Number.
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