New E-filing Requirement for Large Cash Transactions
New 2024 E-filing Requirement for Affects Businesses with Large Cash Transactions
As of January 1, 2024, businesses receiving large amounts of cash must report these transactions electronically (e-file) to the IRS using Form 8300. This applies to any single cash transaction or series of related transactions totaling over $10,000, including money orders and cashier’s checks.
Why the change? E-filing helps combat tax evasion, money laundering, and other illegal activities by increasing transparency and streamlining reporting.
What you need to know:
Who needs to file Form 8300?
Individuals, companies, corporations, partnerships, trusts, and estates that receive more than $10,000 in cash in one transaction or two or more related transactions (any transaction conducted in a 24-hour period). Transactions can also be considered related even if they occur over a period of more than 24 hours if the recipient knows, or has reason to know, that each transaction is one of a series of connected transactions.
What’s considered cash?
U.S. and foreign currency, cashier’s checks, bank drafts, traveler’s checks, and money orders exceeding $10,000. Money orders and cashier’s checks under $10,000, when used in combination with other forms of cash for a single transaction that exceeds $10,000, are defined as cash for Form 8300 reporting purposes.
How to report: Electronically through the IRS website. This is mandatory if you e-file 10 or more information returns (1099s, W-2s, etc.) per year.
When to report: Within 15 days of the transaction.
Penalties for non-compliance: Fines and even jail time.
Note: While businesses report large cash transactions directly to the IRS using Form 8300, banks and other financial institutions have their own separate reporting requirement. They must file “currency transaction reports” whenever someone buys cashier’s checks, treasurer’s checks, bank drafts, traveler’s checks, or money orders with cash exceeding $10,000.
If your business is required to complete Form 8300 to file reports of large cash transactions, in addition to filing on paper, e-filing is an option. To file on paper, you might be required to request a waiver. Filing electronically provides an automatic confirmation of receipt. The IRS also reminds businesses that they can “batch file” their reports, which is especially helpful to those required to file many forms.
Effective January 1, 2024, you may have to e-file Forms 8300 if you’re required to e-file other information returns, such as 1099 and W-2 forms. You must e-file if you’re required to file at least 10 information returns other than Form 8300 during a calendar year.
Remember, this new regulation applies to all businesses receiving large amounts of cash. Don’t get caught off guard – prepare for e-filing in 2024!
Additional Tips:
- Keep accurate records of cash transactions exceeding $10,000.
- File Form 8300 electronically within the required 15-day timeframe.
- The IRS offers resources and tutorials on e-filing Form 8300.
- Consider batch filing if you need to report multiple transactions.
- Keep copies of Forms 8300 for five years. Confirmation receipts do not meet recordkeeping requirements.
By embracing e-filing and staying informed, businesses can streamline their reporting process and ensure compliance with this important regulation.
Questions? Contact a Brady Ware tax advisor.
Questions?
Adam manages a variety of tax and accounting engagements for business clients in numerous industries, including manufacturing, real estate, construction, alternative investments, and professional services. He has experience in federal tax, multi-state corporate income and franchise tax, and municipal income tax. In addition to his tax compliance background, Adam specializes in preparing and managing complex partnership engagements.