Tax Tip of the Week | No. 324 | Form 8300 Filing Requirements

Tax Tip of the Week | October 14, 2015 | No. 324 | Form 8300 Filing RequirementsWhat do you do when you receive a payment in excess of $10,000?

The IRS recently reminded business that they have an obligation to report any cash payments in excess of $10,000 on Form 8300.The simple rule is:  You must file Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, if you receive cash payments in excess of $10,000 cash per customer. These requirements apply to cash transactions occurring in all 50 states and the District of Columbia, as well as U.S. possessions and territories.The IRS indicates you must report cash payments if they are:- More than $10,000- Received as:One lump sum of more than $10,000, or Installments totaling more than $10,000 within one year of the initial payment-Received in the ordinary course of your trade or businessReceived from the same agent or customer-Received in a single transaction or two or more related transactions-Received from an individual, corporation, partnership, association, trust or estateAvoid these common mistakes:Not reporting in time.  Generally you must file Form 8300 within 15 days after you receive the payment. If the 15th day falls on a weekend or holiday, you must file the report by the next business day.Not reporting related transactions. You must file Form 8300 for related transactions. Related transactions can be those occurring between you and the same customer within a 24-hour period, as well as transactions that occur outside of the 24-hour window, but may be one of a series of connected transactions.Not getting the right information. You must provide the correct taxpayer identification number (TIN) of the person from whom you received the cash, and you may be subject to penalties if this is incorrect or missing. If you’re unable to obtain the TIN, file Form 8300 and include information about the circumstances surrounding the missing number.Not providing a written statement to customers. Generally, when you file a Form 8300, you must provide written notification to your customer. You must provide the written statement on or before January 31 of the year following the cash payment.Not keeping a copy of your records. Keep a copy of every Form 8300 you file – as well as the required statement sent to your customers – for at least five years from the date filed.A complete discussion of this filing requirement goes beyond the scope of this article.  Just remember to give us a call if you receive a payment over $10,000.You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.Rick Prewitt – the guy behind TTW...until next week.