Cash Payments over $10,000
Procedures for Cash Payments over $10,000
The Internal Revenue Service (IRS) requires specific reporting procedures when any person in a trade or business receives more than $10,000 in cash in a single transaction or in related transactions in a 12 month period. In order that Purdue University is in compliance with the reporting requirements as directed by the Internal Revenue Code, section 6050I, the following guidelines are provided for your information.
- A reportable cash payment under this regulation is defined as:
- U.S. and foreign coin and currency received in any transaction or “related transactions” (defined below) that exceeds $10,000 or
- Installment payments on related transactions that cause the total cash received within any 12 month period of the initial payment to total more than $10,000 or other previously non-reportable payments that cause the total cash received in a 12-month period to total more than $10,000 or
- Cashier’s checks, bank drafts, traveler’s checks, and money orders you receive, if they have a face amount of $10,000 or less and you receive them in: a) A “designated reporting transaction” (defined below), or b) Any transaction in which you know the payer is trying to avoid the reporting of the transaction on Form 8300.
- Business checks and personal checks drawn on the payer’s own account as well as electronic payments are excluded from this definition and are not considered cash.
- The receipt of a charitable cash contribution in excess of $10,000 is not subject to this regulation and therefore reporting is not required.
- If a reportable cash payment is received in one transaction (or two or more related transactions), an informational return (IRS form 8300) must be filed within 15 days of receipt of the cash payment(s).
Procedures for Cash Payments over $10,000
If your area or department receives cash in excess of $10,000, as defined by this regulation, the procedures listed below must be followed.
- The IRS form 8300 should be completed while the customer is present to ensure the required specific information is accurate. The basic information needed to complete the form: the payer’s complete name, address, tax identification number (social security number), date of birth and occupation, profession, or business. Record the method of identification of the payer (when payment is received in person) for example; driver’s license, passport, or other official documentation. Make a copy of the identification document and attach to the IRS form 8300 along with the payer’s phone number.
If the person or organization on whose behalf the transaction was conducted is different than the payer, record the same information as recorded for the payer. If the transaction was conducted on behalf of more than one person, record the information on all parties
- West Lafayette cash handling areas should contact immediately, the Assistant Bursar, Funds Processing, at 47584 to coordinate the completion of IRS form 8300. As an alternative, contact either the Collections Administrator-Cash Handling Specialist in URCO 49-45350, or the Assistant Director of Treasury Operations in OTO 49-49783. Regional campus collections areas should contact their respective Bursar or Bursar Office Administrator to coordinate the form completion. The IRS instructions and form are available on this page titled Publication 1544 and IRS Form 8300.
The transaction must be reported to the IRS. If the transaction is not reported within 15 days, IRS penalties could be imposed.
- Deliver the completed IRS form 8300 to the respective campus bursar representative; West Lafayette deliver to the Assistant Bursar, Funds Processing in care of the Bursar’s Office located in Hovde Hall. Regional campus personnel should deliver the completed form to their respective Bursar Office. The completed form will be reviewed by Bursar personnel and filed with the IRS.
If additional clarification is needed regarding this regulation, contact either the Collections Administrator-Cash Handling Specialist at 49-45350 or the Assistant Director of Treasury Operations at 49-49783. Please copy and share this information with others in your area as appropriate.
Any transactions between a buyer (or an agent of the buyer) and a seller that occur within a 24-hour period are related transactions. If you receive over $10,000 in cash during two or more transactions with one buyer in a 24-hour period, you must treat the transactions as one transaction and report the payments on Form 8300.
More than 24 hours between transactions.
Transactions are related even if they are more than 24 hours apart if you know, or have reason to know, that each is one of a series of connected transactions.
Designated Reporting Transaction
A designated reporting transaction is the retail sale of any of the following:
- A consumer durable, such as an automobile or boat. A consumer durable is property, other than land or buildings, that: a) Is suitable for personal use, b) Can reasonably be expected to last at least one year under ordinary use, c) Has a sales price of more than $10,000, and d) Can be seen or touched (tangible property).
- A collectible (a work of art, rug, antique, metal, gem, stamp, or coin).
- Travel or entertainment, if the total sales price of all items sold for the same trip or entertainment event in one transaction (or related transactions) is more than $10,000.
The above information is a summary of the reporting regulations and details as defined in IRS Publication 1544.