Large Amount of Greenback Cash

[427Vette]

A friend of mine recently had his dad pass away. While him and his siblings were cleaning out the house they found a large sum of cash money. My friend asked me how to deal with it. It sounds like his share will be in excess of $100,000 (unbelievable!). I didn't know what to tell him. Can you just go into a bank with that much cash? What are the tax implications? Ideas?

I told him the general consensus around here is to spend it on booze, women, fast cars then just blow the rest.

 

[Souschef]

Any cash transaction over $10K has to be reported. There is a concept called smurfing, where you deal in amounts between $9000 and $9500. he may have to go to multiple banks or deposit on multiple days. I am NOT suggesting he do it.
Here is the link to the IRS re form 8300 https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/IRS-Form-8300-Reference-Guide#type

 

[pb4uski]

Inheritances are not taxable. In theory, the money belongs to the estate and the executor is charged with paying the decedant's bills and distributing any residual estate in accordance with the decedent's will and if no will, as required by state law. I would not be comfortable having that much coin around... I would want it in a bank.

I suspect that they will likely get some questions when they try to deposit it as it may be suspected money laundering.

 

[Gone4Good]

Legally and ethically the cash is part of his father's estate and should be handled along with the rest of his assets according to his wishes if he has a will and pursuant to the laws of succession if not. Assuming he doesn't own millions worth of other property there shouldn't be tax implications or other problems as long as the property is handled correctly. When handled incorrectly other problems do tend to arise, particularly when large amounts of cash go missing.

 

[gcgang]

Just fill out the over $10k IRS form saying where you got it.

I have a friend that deals in large cash. His banker told him to just report the over $10k stuff, and that the thing that makes the IRS suspicious is the appearance of "layering", I think it's called, where you make multiple just under $10k deposits.

 

[GrayHare]

If the cash is legit there should be no problem depositing it in a bank though the bank is likely to file the previously mentioned IRS form.

If this stash has been hidden for decades, be aware that currency collectors may have interest. Crisp older currency can be worth more than face value to a collector. eBay can be a value reference.

 

[meierlde]

If the cash is legit there should be no problem depositing it in a bank though the bank is likely to file the previously mentioned IRS form.

If this stash has been hidden for decades, be aware that currency collectors may have interest. Crisp older currency can be worth more than face value to a collector. eBay can be a value reference.

Explain the complete circumstances because older bills could appear to be from drug deals. Anyway the executor should already have an estate account, so deposit it into that account, and then write checks to disburse at the proper time.

 

[pb4uski]

If the cash is legit there should be no problem depositing it in a bank though the bank is likely to file the previously mentioned IRS form.

If this stash has been hidden for decades, be aware that currency collectors may have interest. Crisp older currency can be worth more than face value to a collector. eBay can be a value reference.

If you think it might be worth more than face value, then at least get it into a safe deposit box until its value can be determined and it can be sold.

 

[Fermion]

It is called structuring when you try to keep under the $10k reporting limit by making a bunch of smaller deposits. A great way to lose your $100k and maybe see what jail is like!

 

[dixonge]

So disappointed in this group. The answer is rather obvious, don't you think?

 

[Senator]

Just fill out the over $10k IRS form saying where you got it.

I have a friend that deals in large cash. His banker told him to just report the over $10k stuff, and that the thing that makes the IRS suspicious is the appearance of "layering", I think it's called, where you make multiple just under $10k deposits.

It would called structuring...

 

[rayinpenn]

Actually it is also called smurfing ...



Sent from my iPad using Early Retirement Forum

 

[MichaelB]

I'm amazed that forum members know so many ways to describe depositing large sums of cash while not complying with disclosure regs.

 

[Car-Guy]

Yes, you can just deposit it in the bank. A CTR (Cash Transaction Report) will be filled out for you. You probably won't even know about it being done. If they happen to say something to you about filling out the form and you decide not to deposit the money for some reason, then they should fill out an SAR (Suspicious Activity Report).

Examples: Most large banks and probably all Casinos fill out these forms many times every day since they deal with large sums of cash all the time. If you try to stay under the 10k limit by depositing or withdrawing smaller amounts multiple times in a short period of time, the banks or casinos will probably detect it (as already mentioned, it's usually called structuring) and then file both a CTR and SAR.

Note, a CTR is filled out on you no matter if you are depositing 10K or more in cash or receiving it in cash.

 

[MRG]

Depending on what state the deceased lived in when he died there can be state inheritance tax monies owed.

 

[Walt34]

Legally and ethically the cash is part of his father's estate and should be handled along with the rest of his assets according to his wishes if he has a will and pursuant to the laws of succession if not. Assuming he doesn't own millions worth of other property there shouldn't be tax implications or other problems as long as the property is handled correctly. When handled incorrectly other problems do tend to arise, particularly when large amounts of cash go missing.

What he said. If your friend & his siblings try to work around that and just spend the cash, a lot of bad things can happen. In the worst case scenario they end up in jail and their lawyers end up with the cash.

 

[RunningBum]

Any reason to believe the friend's father was involved in something illegal? I don't know the law, but if the cash is from an illegal activity, the government may seize it and it could be up to him to show where it came from to get it back. Or if the guy just collected cash for work and never declared it, the IRS could come for their cut, and again I suspect the son would have to prove the source of the money. I mean, really, if it's $100K * # of siblings, isn't it likely illegal or undeclared? That's what the govt would probably think, and I don't think they have to presume innocence in cases of cash. He wouldn't go to jail for anything illegal his father did, but he probably wouldn't get the windfall either.

I think I'd be tempted to tuck a lot of it in a safe deposit box, and pay cash at least some of the time for regular things like groceries, restaurants, Target, Home Depot, etc. Seems to me you could spend $500/month without a lot of notice, and go through it over 15-20 years. Spending more than that at once, I'd be worried about someone following me home one night to find out where this money is coming from.

$100K in a bank even after taxes are taken out might be a move I could sleep better at night with. If I was going to deposit it I'd probably consult with a lawyer first. "Better Call Saul" might be the right play after all. I'd also get the siblings on the same page. If the govt goes after one, they will look at all of them.

 

[Hermit]

Any reason to believe the friend's father was involved in something illegal? I don't know the law, but if the cash is from an illegal activity, the government may seize it and it could be up to him to show where it came from to get it back. Or if the guy just collected cash for work and never declared it, the IRS could come for their cut, and again I suspect the son would have to prove the source of the money.

Maybe the old guy didn't trust banks?

... I don't think they have to presume innocence in cases of cash.

Our government? Say in ain't so!

 

[calmloki]

Lord knows you don't want the gubermint thinking there might be an excuse to snatch up that money for, ummm, safekeeping!

https://www.washingtonpost.com/news...tuff-from-people-than-burglars-did-last-year/

I like holding cash. real cash. Some tenants pay in cash. I also declare my income and pay my taxes and it irks me that holding coin of the realm is considered enough cause to allow police seizure.

 

[Fermion]

It wouldn't be quite as odd if you found a little tin of gold coins, because people collect gold coins. Easily could have $100k in gold coins and the government probably would not bat an eye.

 

[RunningBum]

Maybe the old guy didn't trust banks?


Our government? Say in ain't so!

Sure, there are plenty of valid reasons for him to have that cash. I'm just saying that the friend is likely going to have to prove the validity. Rent money paid in cash and declared as income would be valid and hopefully easy to prove and be accepted. If the friend has some proof where the money came from, I'd just deposit it all at once and be ready to answer the questions. if this was a surprise to them, they probably won't have a good answer to give and would be at risk of losing it.

My post was mostly entertainment for me, wondering how I could pull off keeping a big bag of found cash like this, knowing it will never happen to me. And I'd probably only try to keep it in a case like this, where a relative had it stashed. If I actually found it somewhere, I'd try to find the rightful owner, and I'd also be leery of finding drug money that someone would kill for to get it back.

 

[RunningBum]

Thinking a bit more about this (why, I don't know!), if the old guy didn't trust banks, that pattern of behavior would probably be enough. If he had decent income, paid income taxes, minimal or no bank accounts or investment accounts, they could probably make a good case for a guy with a mattress bank.

 

[meierlde]

Thinking a bit more about this (why, I don't know!), if the old guy didn't trust banks, that pattern of behavior would probably be enough. If he had decent income, paid income taxes, minimal or no bank accounts or investment accounts, they could probably make a good case for a guy with a mattress bank.

In particular if the guy was over 80 the story is more easy. If he recalls the bank holiday of the 1930s he may have felt that cash at home was worth a lot, in case another bank holiday was coming. (Or recalling 2008 with the rumors of bank shutdowns felt the same that having cash was the way to go if ATM machines shutdown... Include his age in the narrative given to the bank.

 

[HFWR]

The cash management division of HFWR, Inc. is well-equipped to manage the dispersal of the funds in a controlled and suitably discrete manner, using techniques similar to those used by our marijuana-disposal division.

 

[Slow But Steady]

The cash management division of HFWR, Inc. is well-equipped to manage the dispersal of the funds in a controlled and suitably discrete manner, using techniques similar to those used by our marijuana-disposal division.

So you're going to smoke it?