It’s tax season and if you’re a San Francisco business owner, this time of year can be hectic as you compile your paperwork and prepare to file all the correct forms with the Internal Revenue Service (IRS). One of the forms that many business owners are confused about is Form 8300, Report of Cash Payments Over $10,000 in a Trade or Business. It’s not a common filing, but it’s one that’s critical for many companies. Here’s a look at the mysterious Form 8300 and why you, as a San Francisco taxpayer, may need to file it.
According to the IRS, generally, if you’re in a trade or business and receive more than $10,000 in cash in a single transaction or in related transactions, you must file Form 8300. The form provides information to the IRS and the Financial Crimes Enforcement Network (FinCEN) in their efforts to combat money laundering. Money is “laundered” to conceal illegal activity, including crimes such as drug trafficking, tax evasion and terrorist financing.
Those who must file a Form 8300 include an individual, company, corporation, partnership, association, trust or estate. These may include dealers/sellers of jewelry, boats, aircrafts, furniture, art, automobiles. It may also include travel agencies, insurance companies, attorneys and real estate brokers.
The form must be filed if any part of the transaction occurs within any of the 50 states, the District of Columbia or a U.S. possession or territory (American Samoa, The Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico and the U.S. Virgin Islands). Additionally, Form 8300 must be filed within 15 days after the date the cash transaction occurred.
Effective January 1, 2024, individuals and business owners must electronically file Forms 8300 if you e-file other information returns, such as Forms 1099 series and Forms W-2. You must e-file your Forms 8300 if you’re required to file at least 10 information returns of one or more types other than Form 8300 during a calendar year.
You also need to provide a written statement to each party whose name you included on the Form 8300 by January 31 of the year following the reportable transaction. This statement must include the name, address, contact person and telephone number of your business and the aggregate amount of reportable cash. The statement must also indicate that you provided this information to the IRS. If you do not send the written statement to each person, you as the business owner will be subject to penalties, which are adjusted annually for inflation.
Whether or not to file specific IRS forms can be confusing. It’s not uncommon for individuals or business owners to be unsure whether they need to file Form 8300. Always work with an experienced San Francisco tax attorney or tax professional who can help you navigate all the documents and filings you need to assure your business is protected.
Allison Soares is a partner and tax attorney at Vanst Law LLP. It doesn’t matter the issue: audits, collections, appeals, international disclosures, grumpy people— Allison enjoys fixing problems. In addition to her legal work, she has worked in accounting and utilizes that knowledge to her advantage while handling cases involving EDD audits from San Francisco to San Diego.
