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PROCEDURE & ADMINISTRATION
INDIVIDUALS

when advising clients with Form 8300 Tax-exempt organizations, including the cash.16 This includes receipt of cash
reporting obligations. employee benefit plans, are considered deposited into the account of the agent
persons.13 Charitable organizations are or the account of the principal, or even
Who must file? not required to report cash charitable if the agent delivers the cash directly to
In general, any person who, in the course contributions on Form 8300, as they the principal.17 There is a limited excep-
of a trade or business, receives cash in are not receiving the cash in the course tion where the cash is used by the agent
excess of $10,000 in one transaction or of a trade or business.14 However, within 15 days in a second transaction
multiple related transactions must file an charitable organizations must report and the agent discloses the name of the
information return with the IRS (Form noncharitable cash payments received, principal to the ultimate recipient of the
8300) with respect to the cash received.9 such as cash received for real or personal cash.18
A “person” includes an individual, property rentals or sales of property
trust, estate, partnership, association, or goods from an unrelated trade or What transactions are
company, or corporation.10 A person business activity. covered?
does not include a governmental unit, Persons include those that collect A “transaction” is the underlying event
which includes the U.S. government, cash for the account of another (such as giving rise to the transfer of cash, and
states, political subdivisions of states, the collection of accounts receivable).15 the regulations give broad examples of
and integral parts of states and political Persons can include agents; agents re- transactions: a sale of goods or services;
subdivisions.11 “Trade or business” has ceiving cash in excess of $10,000 on be- sales of real property or intangible
the same meaning as in Sec. 162.12 half of a principal must report receipt of property; rentals of real or personal

9. Sec. 6050I(a). 14. Id.
10. Sec. 7701(a)(1), as referred to in Regs. Sec. 1.6050I-1(a)(1)(i). 15. Regs. Sec. 1.6050I-1(a)(2).
11. IRS Letter Ruling 202118003. 16. Regs. Sec. 1.6050I-1(a)(3)(i).
12. Regs. Sec. 1.6050I-1(c)(6). 17. Chief Counsel Advice 200840044.
13. IRS Publication 1544, Reporting Cash Payments of Over $10,000 18. Regs. Sec. 1.6050I-1(a)(3)(ii).
(Received in a Trade or Business) (rev. September 2014).

EXECUTIVE SUMMARY or a travel or entertainment • Besides filing a Form 8300, the
activity. business on an annual basis must
• Businesses generally must report notify each person named in
cash transactions that exceed • Beginning in 2024, the definition these forms about the information
$10,000. They do so on Form of cash for purposes of the reported to the IRS.
8300, Report of Cash Payments reporting requirement will expand
Over $10,000 Received in a Trade further to include payments made • While the penalties for negligent
or Business. with digital assets such as virtual failure to comply with the Form
currencies, under a provision 8300 reporting requirements
• “Cash” for purposes of this contained in the Infrastructure are relatively mild, they become
information reporting requirement Investment and Jobs Act enacted exponentially larger if the IRS
generally means the currency in late 2021. determines that a business has
of the United States and other intentionally disregarded the fil-
countries, but in limited situations • Once a business receives ing or notification requirements.
the definition encompasses more than $10,000 in cash, as The possibility of steep penalties
cashier’s checks, bank drafts, defined, Form 8300 must be filed for noncompliance makes it
traveler’s checks, and money within 15 days. The reporting especially important for business
orders. The expanded definition obligation cannot be avoided clients to implement appropriate
of cash applies in transactions by separating a transaction into procedures and controls.
that involve the retail sale of a multiple transactions, because
consumer durable (e.g., a car or these will be considered “related
boat), a collectible (e.g., artwork), transactions.”

34 May 2022 The Tax Adviser