Tax treatment for money received from abroad temporarily (neither income nor gift)

[rschenle]

Hello. Thanks for reading. I am a US resident. A friend of mine, a non-US person working abroad, has part of his salary deposited in my US account via wire transfer (he needed a bank account when he started his job, he didn't have one, and he hasn't bothered to open one yet; he does comply with local taxes). I will soon be transferring all his money to an account in his name. I wonder if and how to report this money. It is neither income nor gift, and I will soon part from all of it. I haven't found any information on irs.gov covering this kind of situation. Maybe someone could point me to where I may read about this in irs.gov. Thanks once again. Robert.

 

[LdiJ]

Hello. Thanks for reading. I am a US resident. A friend of mine, a non-US person working abroad, has part of his salary deposited in my US account via wire transfer (he needed a bank account when he started his job, he didn't have one, and he hasn't bothered to open one yet; he does comply with local taxes). I will soon be transferring all his money to an account in his name. I wonder if and how to report this money. It is neither income nor gift, and I will soon part from all of it. I haven't found any information on irs.gov covering this kind of situation. Maybe someone could point me to where I may read about this in irs.gov. Thanks once again. Robert.

How much money are we talking about?

 

[rschenle]

100k. Why would the amount make a difference? Have read makes a difference for gifts, yet this is no gift. Thanks.

ps: apologies for not responding sooner, I did not get an email indicating there was a response.

 

[FlyingRon]

100k. Why would the amount make a difference? Have read makes a difference for gifts, yet this is no gift. Thanks.

ps: apologies for not responding sooner, I did not get an email indicating there was a response.

The problem is that you've likely broken the laws for both money laundering and the tax code in the US with that much money. The threshold is low ($10,000 over the course of an entire year).

 

[LdiJ]

100k. Why would the amount make a difference? Have read makes a difference for gifts, yet this is no gift. Thanks.

ps: apologies for not responding sooner, I did not get an email indicating there was a response.

That much money absolutely had to be reported to the federal government. You are going to need a consult with an attorney before you move that money. When you move it the bank will have to report it. You need to get on top of it ASAP.

 

[rschenle]

Thanks for the responses!

Report it how? Any leads into where to look for this in irs.gov or what form to fill?

 

[rschenle]

Bump. Would anyone know what IRS form to fill to report this? (this = money received from abroad temporarily that is neither income nor gift)

Thank you