What IRS Form 8300 (2019) Is For
IRS Form 8300 (2019) is used by any trade or business to report cash payments over $10,000 received in one transaction or related transactions. The report on cash payments helps the federal government identify and prevent money laundering, tax evasion, and other illicit activities. It applies to cash, cashier’s checks, traveler’s checks, and money orders used in reportable transactions under the Internal Revenue Code.
For more guidance on IRS reporting requirements, see our IRS Form Help Center.
When You’d Use IRS Form 8300 (2019)
Businesses must file Form 8300 when they receive more than $10,000 in cash during a single or related transaction within their trade or business.
- Single Transaction: You must file Form 8300 within 15 days if your business receives more than $10,000 in cash in one transaction from an individual or entity.
- Related Transactions: You must file if aggregate cash payments from the same person within 24 hours or through connected transactions exceed $10,000.
- Designated Reporting Transactions: You must file when monetary instruments such as cashier’s checks, money orders, or traveler’s checks are used in retail sales of tangible personal property, vehicles, or consumer durables exceeding $10,000.
- Payment Plans: You must file when smaller installment payments reach a combined total of $10,000 in cash receipts during the same calendar year.
Keeping accurate records is crucial, and you can request a business tax transcript to ensure your filings are complete.
Key Rules or Details for 2019
Several vital requirements apply to IRS Form 8300 (2019), outlining what qualifies as a reportable transaction and how to meet filing deadlines.
- Aggregate Amounts: You must combine all cash received from the same person for the same transaction or related transactions within 12 months when determining if the $10,000 threshold has been met.
- Designated Reporting Transaction: A designated reporting transaction includes retail sales of cars, boats, jewelry, art, or other consumer durables exceeding $10,000 that are paid for with cashier’s checks, money orders, or other monetary instruments.
- Required Filing Date: You must file Form 8300 within 15 days after receiving the payment that causes total cash receipts to exceed $10,000 in a single or related transaction.
- Cash Definition: Cash includes currency, bank drafts, traveler’s checks, and money orders, but excludes personal checks, bank checks, and wire transfers from a financial institution.
- Customer Identification: You must verify the identity of the person making the payment using an official document, such as a driver’s license, alien registration card, or other valid identification.
- Written Statement: You must send a written statement to each person listed on the form by January 31 of the following calendar year showing the total cash payments reported.
Step-by-Step (High Level)
The following steps outline how to properly complete and file Form 8300 in compliance with federal law and cash reporting requirements.
- Identify Reportable Cash Payments: Determine whether the total cash received exceeds $10,000 in a single or related transaction conducted as part of your trade or business.
- Collect Correct Information: Obtain the payer’s name, address, taxpayer identification number or employer identification number, and full details about the transaction.
- Complete the Form: Accurately describe the transaction, including the total price, total cash received, and whether the payment was made using monetary instruments such as a money order or cashier’s check.
- File Form 8300 Within 15 Days: Submit the form through the BSA E-Filing System or mail it to the IRS address listed in the official instructions before the due date.
- Provide a Customer Statement: Prepare and send a written statement to each person named on the form by the required filing date, confirming that their cash payment has been reported and received.
- Maintain Records: Keep copies of all filed forms, customer statements, and supporting documents for a minimum of five years to comply with federal government requirements.
Unresolved issues with unfiled federal income tax returns can also trigger additional IRS scrutiny.
Common Mistakes and How to Avoid Them
Businesses often make filing errors that result in penalties or compliance issues. The following are common mistakes and how to prevent them.
- Missing Related Transactions: Many businesses fail to track multiple cash payments from the same person. To ensure that aggregate amounts are recorded accurately over 12 months, maintain a log of all cash receipts within that timeframe.
- Incorrect Information: Filers sometimes enter misspelled names, incorrect taxpayer identification numbers, or incomplete details. Always verify each person’s identification using official documents, such as a driver’s license or alien registration card.
- Failure to File on Time: Missing the 15-day filing deadline is a frequent error; create a calendar reminder or assign a specific employee to monitor reportable transactions and ensure that each form is submitted promptly.
- Misunderstanding Cash Definition: Some businesses treat personal checks or wire transfers as cash; however, only currency and specific monetary instruments, such as money orders, bank drafts, or cashier’s checks, are considered cash.
- Failing to Provide Customer Statements: Businesses sometimes overlook the written statement requirement; review all Form 8300 filings each January and issue statements before the due date.
- Ignoring Suspicious Activity: Some fail to file when illegal activities or attempts to avoid reporting are suspected; always file a Form 8300 marked as a suspicious transaction without alerting the customer.
If you've missed a deadline or made errors in reporting, explore IRS penalty abatement options to reduce or eliminate fines.
What Happens After You File
Once you file a Form 8300 report, the IRS and the Financial Crimes Enforcement Network (FinCEN) record the information to identify potential money laundering and verify compliance with cash reporting requirements. The IRS may cross-check the total cash received against reported income to detect underreporting or fraudulent transactions. Businesses are required to retain copies of all forms, written statements, and supporting documents for a minimum of five years. While no confirmation is issued for mailed forms, the BSA E-Filing System provides electronic receipts for your records.
If IRS penalties have created an unmanageable burden, you might qualify for relief through the IRS Offer in Compromise program.
FAQs
Do personal checks count as cash payments?
No, personal checks drawn from a financial institution do not qualify as cash payments under federal law because they are not considered monetary instruments for Form 8300 reporting.
What if my customer refuses to provide a taxpayer identification number?
You must still file the form and note “customer refused” in the taxpayer identification field; this shows reasonable effort to comply with federal reporting requirements.
What are the penalties for not filing Form 8300?
Penalties may include fines for failure to file, submitting incorrect information, or intentional disregard, which can result in substantial monetary penalties and potential criminal liability.
Can small businesses file Form 8300 electronically?
Yes, small business owners can file Form 8300 through the BSA E-Filing System, which provides faster processing and confirmation of submission.
What should I do if I suspect illegal activity?
You should file a Form 8300 marked as a suspicious transaction without informing the customer, as required by the Internal Revenue Code and federal law.
