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  1. #21
    Join Date
    Jan 2016
    Posts
    432

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Quote Quoting germine248
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    I also have $36,000 cash, gifted, as cash, by my husband over 4 years time. Will this also face similar fate if I deposit in bank? My husband is willing to testify if needed (he has state job, making around $70,000 annually)?
    .

    Did you read Taxing Matter's post carefully? The case he quoted addresses the issue you will face if your husband is called to testify about these supposed gifts.

  2. #22
    Join Date
    Mar 2020
    Posts
    9

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Thanks! Honestly, due to lack of my knowledge, I could not fully understand the wealth of information Taxing Matter has posted. If someone could explain the following, it is greatly helpful to me:

    (i). If my husband testifies on my behalf, confirming that he gave that $36,000 gift in cash over 4 years, will it be enough?

    (ii). can the bank or IRS have a copy of the currency transaction report that probably would have submitted when I withdrew $120,000, while closing my account? if they have, it will show that I really withdrew cash in 2011.

    My children and friend will also testify my habit of keeping cash and that I have absolutely no job since 2011. I have been suffering from thyroid problem, vertigo, etc since then, and I can produce letter from my doctor.
    Please share your thoughts.

  3. #23
    Join Date
    Oct 2014
    Posts
    7,706

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Quote Quoting germine248
    View Post
    Thanks! Honestly, due to lack of my knowledge, I could not fully understand the wealth of information Taxing Matter has posted. If someone could explain the following, it is greatly helpful to me:

    (i). If my husband testifies on my behalf, confirming that he gave that $36,000 gift in cash over 4 years, will it be enough?
    It would be helpful, but whether it will convince the agent or the court I cannot say. With regard to the $120.000 or the $36,000 a lot will depend, should the IRS audit the return, on how your case is presented and the outlook of the agent and his/her supervisor. There is no way to tell you for sure how it would come out. In your situation, a lot would really hinge on how credible you and your husband were since the main evidence here would seem to be your testimony. Some people just naturally come across more convincing than others. You've no doubt noticed that just in your interactions with people over the years. Not having heard what you'd say I cannot guess how compelling a witness you and your husband would be.

    Quote Quoting germine248
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    (ii). can the bank or IRS have a copy of the currency transaction report that probably would have submitted when I withdrew $120,000, while closing my account? if they have, it will show that I really withdrew cash in 2011.
    There will be no CTR for the withdrawal. The CTR is only required for large cash deposits, not withdrawals.

    Personally I wouldn't let this issue prevent me from depositing the money and making use of it. But you might want to consult a tax attorney so you'll be prepared should the IRS audit your return. That audit, if it happens at all, would not occur for awhile, and whenever it does occur, you may succeed in convincing the IRS of what happened. No guarantees of outcome, but if you are prepared and make a convincing witness that will help a lot. The attorney might be able to help you find additional evidence, too, to help bolster your position.

  4. #24
    Join Date
    Mar 2020
    Posts
    9

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Thanks a million!

    Please provide your valuable comments on withdrawing large amount of cash (if any, in future) to store it in a safe for years, and later to prove that the cash was in fact withdrew. I can keep copies of bank receipts or statements from closing time but if it is more than 7 years after withdrew the cash, because banks won't keep the receipts, the IRS may say that those receipts are fabricated. I can take someone with me to witness this transaction but the IRS may say that the person's testimony is not reliable or so. However, I wish to follow what you, a very knowledgeable person, suggest.

    If there is a dispute between a tax payer and IRS in matters as above, and the tax payer does not agree with IRS, where the court hearing takes place? In Washington DC or somewhere in a main city such as Orlando, Tallahassee, Miami, etc, which is closest to the resident's home in Florida?

  5. #25
    Join Date
    Oct 2014
    Posts
    7,706

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Quote Quoting germine248
    View Post
    Thanks a million!

    Please provide your valuable comments on withdrawing large amount of cash (if any, in future) to store it in a safe for years, and later to prove that the cash was in fact withdrew. I can keep copies of bank receipts or statements from closing time but if it is more than 7 years after withdrew the cash, because banks won't keep the receipts, the IRS may say that those receipts are fabricated. I can take someone with me to witness this transaction but the IRS may say that the person's testimony is not reliable or so. However, I wish to follow what you, a very knowledgeable person, suggest.
    I wouldn't recommend keeping large amounts of cash at home for any length of time for a number of reasons. However, if you do it and you have documentation of where the cash came from, like the withdrawal slip from the bank, etc., that is helpful. Keep that with the cash or some other safe place. Testimony of others is helpful too, especially if they are people who don't have an incentive to cover for you. But as you note, the problem is that even having those things is not a guarantee the IRS will be convinced that the money you deposit today was the same cash you took out years ago. Still, having the additional evidence besides just your own testimony gives you a better shot at succeeding.

    Quote Quoting germine248
    View Post
    If there is a dispute between a tax payer and IRS in matters as above, and the tax payer does not agree with IRS, where the court hearing takes place? In Washington DC or somewhere in a main city such as Orlando, Tallahassee, Miami, etc, which is closest to the resident's home in Florida?
    In an income, gift, or estate tax matter you have the option to take the dispute to the U.S. Tax Court prior to paying the tax the IRS claims is due. While the court is located in Washington DC the trial judges hold court in various cities around the country. For example, in Florida it holds trials in Miami, Tampa, and Jacksonville, and will hold small tax court cases sometimes in Tallahassee, too. So you can get a trial reasonably close to where you live and not have to travel to DC.

  6. #26
    Join Date
    Mar 2020
    Posts
    9

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Thanks a million, highly appreciated! Have a nice evening.

  7. #27
    Join Date
    Oct 2014
    Posts
    7,706

    Default Re: Possible Problem if I Deposit Cash in Bank Account

    Quote Quoting germine248
    View Post
    Thanks a million, highly appreciated! Have a nice evening.
    You're welcome, glad the information was useful.

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