FlyerTalk Forums - View Single Post - Spending $250K for Centurion, How About IRS? Large Cash deposits out of your league?
Old Aug 17, 10, 9:33 am
Join Date: Oct 2007
Programs: Plat:US,DL (ex KL,AF,LX,LY) Gold:BA,VS (ex CO,UA).Plat.SPG,HGP Diam.HH. ICHG Plat RA. Amex Centurion
Posts: 673
Originally Posted by boncovi View Post
All points taken except this. How can one avoid taxes by structuring transactions below 10K? When you go over 10K, you don't get taxed. It just gets reported to the government.

You don't set yourself up as a reseller, you avoid tax, that's another story. I just couldn't make connection between depositing below 10K and avoiding tax.
Correct. Don't confuse other posters' advice for genuine legal rulings.

There's a difference between doing something suspicious and doing something illegal.

What they are warning you against is only due to the suspicion, nobody will throw you in a rat infested cell with drug dealers.

The thing to remember is this: You are like a person at the back of a store, making gestures like you have been slipping items into your jacket lining. Yes, the camera will see you. Yes, a security guard will pull you aside. Yes, maybe even a cop will be called. But at the end of the day, if you can explain legitimately that you simply have bad mosquito bites and are scratching, and there is nothing inside your jacket - they will send you on your way.
Will it be a pleasant way to spend your afternoon? Maybe not - but if you have done nothing wrong, and have proof of that, then you'll end up walking out of the store on your way.

A more troubling question is how this customer purchases in your store over 10k in cash, as by law you must file an AML report under the Patriot Act for that transaction or series of transactions (you as the salesperson, not the customer).

And disregard the previous financial expert advice regarding income tax on gifts, as it is fundamentally incorrect in several ways. If in doubt, ask a real tax attorney or any good accountant. (Anyone telling you that you are subject to income tax on a gift over 12k... I don't know where to begin...)
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