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Tax Question
Posted on 4/25/13 at 5:53 pm
Posted on 4/25/13 at 5:53 pm
In regard to the pitiful interest rates, say someone were to take a huge sum of money out of the bank to keep in a safe deposit box in cash.
Later (2,3, or 5 years or more) if it's re-deposited or a CD opened, would it be a problem. Would it raise a red flag and cause some bullchit?
Later (2,3, or 5 years or more) if it's re-deposited or a CD opened, would it be a problem. Would it raise a red flag and cause some bullchit?
1
Posted on 4/25/13 at 6:06 pm to Geauxtiga
quote:
to keep in a safe deposit box in cash.
It's illegal to put cash in a safe deposit box.
Posted on 4/25/13 at 6:15 pm to wegotdatwood
quote:That is shocking to me and I don't understand why it would be; however, it's irrelevant where I put it in terms of what I'm needing to know so let's say I put it in the seat of my truck.
It's illegal to put cash in a safe deposit box.
EDIT: It's also not true.
quote:
Sweet sees what's in safe-deposit boxes that have been abandoned. In addition to guns, ammo and cremains, Sweet says 5 percent to 10 percent of the boxes have substantial cash -- $5,000 or more.
That blows a hole in a popular misconception -- that it's illegal to keep cash in a safe-deposit box.
LINK
This post was edited on 4/25/13 at 6:20 pm
Posted on 4/25/13 at 7:38 pm to Geauxtiga
My understanding is that when you decide to redeposit the money, anything cash of $10,000 or more is reported to some government agency (not sure if IRS or not). You could probably just make different deposits, all under $10,000.
eta: I would leave a clear paper trail to prove that it is not income.
eta: I would leave a clear paper trail to prove that it is not income.
This post was edited on 4/25/13 at 7:42 pm
Posted on 4/25/13 at 7:44 pm to RunningBlake
Thanks. I've heard something about 10K too.
What I'm hoping is that there has to be a W2 for it to be considered taxable. Seems like the burden of proof should be on the gov't but I wouldn't be surprised if that's not how it is.
What I'm hoping is that there has to be a W2 for it to be considered taxable. Seems like the burden of proof should be on the gov't but I wouldn't be surprised if that's not how it is.
quote:Like a copy of the CD it was in AND the withdrawal receipt?
I would leave a clear paper trail to prove that it is not income.
Posted on 4/25/13 at 7:55 pm to Geauxtiga
The burden of proof is always on the taxpayer. If audited, you will have to prove to any taxing authority that the cash you redeposited was not income in the year you redeposited it.
That said, the chances of being audited are very slim.
Yes, copy of cd, receipt, and rental of safety deposit box.
That said, the chances of being audited are very slim.
Yes, copy of cd, receipt, and rental of safety deposit box.
Posted on 4/26/13 at 10:19 am to Geauxtiga
IRS Bank Account Audit - it is the worst. IRS will obtain from you or by court order a copy of your small business bank account info from 01/01/XXXX to 12/31/XXXX. Every deposit will be characterized as income unless you can provide documents stating otherwise. Only withdrawals that you provide documents/receipts will be included as expenses. Never comingle business with personal because of this.
Posted on 4/29/13 at 2:40 pm to CHSBears
quote:
What I'm hoping is that there has to be a W2 for it to be considered taxable
Not true. If audited, they will make you prove it is not income. Think about the yard man that makes $100k a year cash and does NOT get a W-2... IRS comes along and considers all deposits as income until he proves otherwise. Hence the business and personal commingling mention above
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