Page 2 - When Money Costs Too Much: Section 8300 Filing Requirements and Penalties

other businesses. [Treasury Regulations
section 6050I-1(a)(2)].
In addition, the IRS encourages busi-
nesses to file Forms 8300 to report
“suspicious transactions,” transactions
in which it appears that a person is
attempting to cause Form 8300 not to
be filed, or to file a false or incomplete
form (IRM 4.26.10.7.1). There are some
exceptions to these requirements. To
avoid duplicate reporting, financial insti-
tutions that are required to file Currency
Transaction Reports (CTR) do not have
to file Form 8300 [Treasury Regulations
section 1.6050I-1(d)(1)]. There also is no
requirement to report a cash transaction
if the entire transaction occurs outside of
the United States [Treasury Regulations
section 6050I-1(d)(4)].

Preparing and Filing Form 8300
Under the authority of IRC section
6050I, the IRS developed Form 8300
(https://www.irs.gov/pub/irs-pdf/f8300.
pdf). At the top of the form, there is a box
to check if the Form 8300 is amending
a prior form or reporting a suspicious
transaction. It may be used to voluntari- filer must include information about that business that received the cash, including
ly report suspicious transactions under person as well. the TIN, name, address, and nature of
$10,000, as well as transactions over Part III asks for the “Description of the business. There is also a space for
$10,000 that are required to be reported Transaction and Method of Payment.” comments about the information reported
(IRM 4.26.10.7). This includes the date of the receipt of in Parts I–IV. If the filer cannot complete
Part I asks for the “Identity of the cash, the total amount, whether it was the Form 8300, the filer should explain in
Individual From Whom the Cash Was received in more than one payment, and the comment section (IRM 4.26.10.7.1;
Received,” including the name, TIN, the total price for the goods or services, 4.26.10.10.3.1).
address, date of birth, and occupation if different from the amount of the cash The Form 8300 must be signed under
of all payees. The filer must request an received. The filer must also break out penalties of perjury by an individual
identifying document from the individual the payment between types of cash and who has been authorized to do so for the
who paid over the cash, such as a pass- monetary instruments, such as cashier’s business that received the cash. A busi-
port, driver’s license, or alien registration checks and money orders. The country ness must file Form 8300 within 15 days
card, and report that information in Part I. of issuance for any foreign currency and after the cash was received. If a business
Part II asks for information about the issuer’s name and serial number for receives later payments toward a single
the “Person on Whose Behalf This any monetary instruments must be stat- transaction or two or more related trans-
Transaction Was Conducted.” The filer ed. The filer must indicate the amount actions, the business must file the Form
must provide the individual’s name, in $100 bills or larger dollar amounts. 8300 when the total amount paid exceeds
or the organization’s name, TIN or In addition, the filer must identify the $10,000. Each time payments aggregate
employer identification number (EIN), type of transaction from one of nine more than $10,000, the business must file
the “doing business as” name, if appli- categories, including personal property, another Form 8300.
cable, and the business address. If the real property, personal services, business The IRS is encouraging businesses to
recipient knows or has reason to know services, and the exchange of cash, or file Forms 8300 electronically through
that the person from whom the cash was mark “other” and provide a description. the BSA E-Filing System (see IR-2019-
acting as an agent for another person, the Part IV asks for information about the 20, https://bit.ly/3gT4llf). Form 8300

JUNE 2020 / THE CPA JOURNAL 53

6/28/20 5:58 PM
06-2020 TPP_zEssentials.temp.indd 53
06-2020 TPP_zEssentials.temp.indd 53 6/28/20 5:58 PM