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Thread: Depositing funds over $10,000

  1. #1
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    Depositing funds over $10,000

    I am considering buying a investment property. My father wants to be a silent partner and invest $25,000.

    We want to deposit the $25,000 in my credit union savings account before I apply for a loan so as to make us look stronger so to speak. I don't want to get caught up in a tax issue, so I was thinking we would deposit the money in 3 separate checks so as not to trigger the $10,000 report to the Fed, we also wish to treat the $25,000 as a loan. I want to keep this all on the up and up.

    Is there any thing I need to watch out for, please advise.

  2. #2
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    Quote Originally Posted by gunnails View Post
    I am considering buying a investment property. My father wants to be a silent partner and invest $25,000.

    We want to deposit the $25,000 in my credit union savings account before I apply for a loan so as to make us look stronger so to speak. I don't want to get caught up in a tax issue, so I was thinking we would deposit the money in 3 separate checks so as not to trigger the $10,000 report to the Fed, we also wish to treat the $25,000 as a loan. I want to keep this all on the up and up.

    Is there any thing I need to watch out for, please advise.
    Im out sorry. If you change your mind im around.

  3. #3
    Depositing money in your account over $10,000 triggers a "Currency Transaction Report (CTR)" that is automatically logged with whatever financial institution is REMOVING or ADDING funds to the account. It's to monitor the flow of money, so that funds are monitored easier by financial institutions and watch dogs. If the funds are income for you, you must claim them on your taxes for 2012, but from what you described that's not the case. I suggest opening a separate account and labeling it "investment" or something like that, and the only way you'd get in trouble is if you used that money to buy a car for yourself or something non-business related.

    Structuring is the term that is used to avoid having CTRs registered by moving money under the $10,000 threshold. IMO, no one will look at your financial movements unless you have a significant history of doing this, and you can't justify where the money came from.

    Example: If I gave you $9,000 in cash, but you can't justify where the money came from, and we did the transaction 10 times (to avoid CTRs), if someone is paying attention that would draw attention to you.

    What you're doing is trying to start an investment. I'd read about it a little more, but you're not doing anything wrong at this point, IMO. It would be different if you did it 50 times over.

  4. #4
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    Quote Originally Posted by thebigragu View Post
    Im out sorry. If you change your mind im around.
    =================================================

    I open to suggestions, preferably legal ones. Lets say, how would you do this if you didn't want to go to jail.

  5. #5
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    Send me the $25,000. I will send you back $500,000 in about 6-8 weeks.

    I can do this because I am a prince in Zimbabwe.

  6. #6
    Quote Originally Posted by gunnails View Post
    =================================================

    I open to suggestions, preferably legal ones. Lets say, how would you do this if you didn't want to go to jail.
    Also, if your father wants to be a silent partner you and he can say he "gifted" you money. From parent to child, there is a yearly exception for the amount that can be gifted. It should be near the amount you listed above.

    I don't know what the exact cap for a financial gift is before it needs to be taxed.

  7. #7
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    Quote Originally Posted by John_0515 View Post
    Depositing money in your account over $10,000 triggers a "Currency Transaction Report (CTR)" that is automatically logged with whatever financial institution is REMOVING or ADDING funds to the account. It's to monitor the flow of money, so that funds are monitored easier by financial institutions and watch dogs. If the funds are income for you, you must claim them on your taxes for 2012, but from what you described that's not the case. I suggest opening a separate account and labeling it "investment" or something like that, and the only way you'd get in trouble is if you used that money to buy a car for yourself or something non-business related.

    Structuring is the term that is used to avoid having CTRs registered by moving money under the $10,000 threshold. IMO, no one will look at your financial movements unless you have a significant history of doing this, and you can't justify where the money came from.

    Example: If I gave you $9,000 in cash, but you can't justify where the money came from, and we did the transaction 10 times (to avoid CTRs), if someone is paying attention that would draw attention to you.

    What you're doing is trying to start an investment. I'd read about it a little more, but you're not doing anything wrong at this point, IMO. It would be different if you did it 50 times over.
    =================================================

    Thanks John.

    So is there any advantage to doing three deposits under $10k rather then just one lump sum deposit in to an account labeled as investment account and used only for investment purposes?

  8. #8
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    Quote Originally Posted by John_0515 View Post
    Also, if your father wants to be a silent partner you and he can say he "gifted" you money. From parent to child, there is a yearly exception for the amount that can be gifted. It should be near the amount you listed above.

    I don't know what the exact cap for a financial gift is before it needs to be taxed.
    ==============================================

    The thing is that it would not be a gift, more of a generous interest free loan, I fully expect to pay him back in full plus some.

  9. #9
    Quote Originally Posted by gunnails View Post
    =================================================

    Thanks John.

    So is there any advantage to doing three deposits under $10k rather then just one lump sum deposit in to an account labeled as investment account and used only for investment purposes?
    If you do it 3 times, and anyone asks you about it, it's a gift/or money that he owed you. $25,000 isn't a lot of money, and nobody will care unless he sold drugs and made the money that way (or it came from somewhere illegal).

    People move way more than that amount every day, and it's legit. What I wrote above is if you're really worried and want to do things on the "up and up".

  10. #10
    Quote Originally Posted by gunnails View Post
    ==============================================

    The thing is that it would not be a gift, more of a generous interest free loan, I fully expect to pay him back in full plus some.
    There should be an accountant on here somewhere that can explain better, but I think you'll be fine.

  11. #11
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    Quote Originally Posted by gunnails View Post
    =================================================

    I open to suggestions, preferably legal ones. Lets say, how would you do this if you didn't want to go to jail.
    What John said. A gift is allowed once. Massive amounts get moved this way. Other ways involve chip dumping done all the time in gambling. That amount over two three days would go undetected anywhere.

  12. #12
    Is the investment his, to be reapaid or otherwise reimbursed by the business? Then he should be listed as the investor, he can be "silent" if he wishes in terms of management/ownership.

    Is he giving the money to you? Then it's a gift, pay your taxes as appropriate. Desposit the whole thing and don't try to play the system.

    Or.....

    If you're planning on being a business, maybe (just maybe) you should get your financial advice from your duly contracted accountant/financial manager, not the assembled throbbing pulsing brain of JI?

  13. #13
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    Quote Originally Posted by John_0515 View Post
    If you do it 3 times, and anyone asks you about it, it's a gift/or money that he owed you. $25,000 isn't a lot of money, and nobody will care unless he sold drugs and made the money that way (or it came from somewhere illegal).

    People move way more than that amount every day, and it's legit. What I wrote above is if you're really worried and want to do things on the "up and up".
    "Love and Consideration" is a legitimate use of funds; Gunnails father can write a letter to your mortgage broker or Credit Union saying just that; declaring his intention to put that $25K into escrow before close.

    If he puts the money in your account; what purpose does that serve? Are trying to look like you have better savings? I don't understand the point.

  14. #14
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    Quote Originally Posted by thebigragu View Post
    What John said. A gift is allowed once. Massive amounts get moved this way. Other ways involve chip dumping done all the time in gambling. That amount over two three days would go undetected anywhere.
    ============================================

    Gotcha.

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    Quote Originally Posted by Warfish View Post
    Is the investment his, to be reapaid or otherwise reimbursed by the business? Then he should be listed as the investor, he can be "silent" if he wishes in terms of management/ownership.

    Is he giving the money to you? Then it's a gift, pay your taxes as appropriate. Desposit the whole thing and don't try to play the system.

    Or.....

    If you're planning on being a business, maybe (just maybe) you should get your financial advice from your duly contracted accountant/financial manager, not the assembled throbbing pulsing brain of JI?
    ===============================================

    I think the best way to describe it would be a loan that I intend to pay back in full.

    Sent an E-mail to my accountant yesterday and have not heard back yet (impatient), other then that I am the financial manager.

  16. #16
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    Quote Originally Posted by WestCoastOffensive View Post
    G


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    Quote Originally Posted by JetPotato View Post
    Send me the $25,000. I will send you back $500,000 in about 6-8 weeks.

    I can do this because I am a prince in Zimbabwe.
    /thread

  18. #18
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    Money laundering triggers for SAR's (suspicious activites reports) attached to the Patriot Act keep an eye on odd things with deposits below 10k.

    http://www.bankersonline.com/securit...ionreview.html

  19. #19
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    Quote Originally Posted by WestCoastOffensive View Post
    "Love and Consideration" is a legitimate use of funds; Gunnails father can write a letter to your mortgage broker or Credit Union saying just that; declaring his intention to put that $25K into escrow before close.

    If he puts the money in your account; what purpose does that serve? Are trying to look like you have better savings? I don't understand the point.
    ================================================== ==

    Yes the $25K would be to make me appear to be a better credit risk, I have excellent credit but I am cash poor.
    This would be my first investment property and although I have lots of experience flipping house as far as doing the rehab work and where to get the most bang for the buck, I haven't done it for my self, I've done it as a contractor for others.
    The whole how to finance part is new to me.

    So your saying just have him write a letter of intent, and that has as much or more value then just having the cash in a account of mine to a mortgage lender.

    Do you do business in the Portland Area?

  20. #20
    Quote Originally Posted by jetswin View Post
    Money laundering triggers for SAR's (suspicious activites reports) attached to the Patriot Act keep an eye on odd things with deposits below 10k.

    http://www.bankersonline.com/securit...ionreview.html
    This... Though a one time note on the account of 3 rapid succession deposits which appear evasive likely won't flag it as noteworthy, it will flag it...

    You never want to get flagged because then the eyes are upon you

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