In Fact Sheet 2020-11; IR 2020-168, the IRS has presented a series of examples where a person might have to file Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business.
Generally, any person in a trade or business who receives more than $10,000 in cash in a single transaction or in related transactions must file a Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. A “person” is an individual, company, corporation, partnership, association, trust, or estate.
A person must file Form 8300 if they receive cash of more than $10,000 from the same payer or agent:
- in one lump sum;
- in two or more related payments within 24 hours, (e.g., a 24-hour period is 11 a.m. Tues-day to 11 a.m. Wednesday); or
- as part of a single transaction or two or more related transactions within a 12-month period.
Reporting Situation Examples
The Fact Sheet contains the following examples of reporting situations:
- New or used automobile dealers – If a husband and wife purchased two vehicles at one time from the same dealer, and the dealer received a total of $10,200 in cash, the dealer can view the transaction as a single transaction or two related transactions. Either way, the dealer needs to file only one Form 8300. But the dealership does not file Form 8300 if a customer pays with a $7,000 wire transfer and a $4,000 cashier check. A wire transfer is not considered cash.
- Suppose a customer purchases a vehicle for $9,000 cash – Within 12 months, the customer pays the dealership cash of $1,500 for accessories for that vehicle. The dealer does not need to file Form 8300 unless the accessories purchase was related to the original vehicle purchase.
- Taxi company – When lease payments made in cash by a taxi driver to a taxi company within a 12-month period exceed $10,000 in total, the taxi company needs to file Form 8300. Then, if the company receives more than $10,000 cash in additional payments from the driver, the company must file another Form 8300.
- Landlords – The 12-month period also applies to landlords who need to file Form 8300 once they have received more than $10,000 in cash for a lease during the year. If a person uses a dwelling unit as a home and rents it less than 15 days during the year, its primary function is not considered rental in a trade or business, so they don’t need to report a cash receipt of more than $10,000.
- Bail-bonding agent – A bail-bonding agent must file Form 8300 when they receive more than $10,000 in cash from a person. This applies to payments from persons who have been arrested or anticipate arrest. The agent needs to file the form even though he hasn’t provided a service when they received the cash.
- Colleges and universities – Colleges and universities must file Form 8300 if they receive more than $10,000 in cash in one or more transactions within 12 months. A Form 8300 exception applies for government entities but not for educational entities.
- Contractors – Contractors must file Form 8300 if they receive cash of more than $10,000 for building, renovating, remodeling, landscaping, and painting.
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