Cash gifts from foreign country

[davew9128]

No, Davew9128 was wrong. It's not a customs issue.

See:

The U.S. Customs Cash Limit: Money at the Border | Clearit USA

Did you read your own link? You know I do international tax for a living, right?

 

[davew9128]

How it is a customs issue , as the amount that is brought each time is below 10,000 threshold which does not need any reporting from my side? Once it is deposited in bank, and IRS comes after me, it will be a tax issue as IRS comes with suspicion that I did not pay tax on that "earned income" although I did not earn but it was gifted.

The fact that you are even worried about IRS tells me you either suffer from paranoid delusions, or are up to something else. In the real world, people with family members outside the US receive money ALL THE TIME. To me, so long as annual gifts from any single person are below $100k, its a non-issue.

 

[not2cleverRed]

I do agree that it might be a foolish thing but unfortunately, now, we cannot turn back time. I am and was in very difficult;t financial difficult situations therefore my parents sold their belongings in Philippines and arranged that money. Still I am living with very low income. Wish to buy a small home to live with that cash (it is my wish of my parents too) by depositing this cash in a bank. Do I face any issue from tax people or any other government employees if I put this cash in my bank account, and if so, how to handle this.

This is inconsistent with what you have stated.

If you were in such dire straits, why do you still have the money?

If you are still struggling, how are going to financially maintain a house?

Are you just trying out a story on us?

 

[adjusterjack]

I would hope that would be enough. But I would add something else. If the records are still available have your parents send you their bank statements for the months that the withdrawals occurred. That should correspond with the dates of your trips and your cousin.

It's also possible that if you are going to be contacted by the IRS it could take a year so keep those letters and records in a safe place. Scan them to your computer and phone so you have some redundancy.

 

[adjusterjack]

Did you read your own link?

Yes.

The amounts for each trip were $10,000 or less and did not have to be declared. Ergo, not a customs issue.

You disagree?

You know I do international tax for a living, right?

I'm happy for you.

 

[kennedy9]

I would hope that would be enough. But I would add something else. If the records are still available have your parents send you their bank statements for the months that the withdrawals occurred. That should correspond with the dates of your trips and your cousin.

It's also possible that if you are going to be contacted by the IRS it could take a year so keep those letters and records in a safe place. Scan them to your computer and phone so you have some redundancy.

Thanks adjusterjack.

not2cleverRed; I was sharing house with my friends, now I got married and needs a house for my family. I want to see my parents’ love every day in the new house which will be brought using the money and love of my parents: that’s why I did not spend that money despite all the financial issues I have all these years. Sentiments are more powerful than financial burdens.

 

[AlmostThere]

OP - is the issue on the Philippines side? While it is legal to bring the $$ into the US, it looks like it is not legal to take that much currency out of the Philippines.

 

[Zigner]

OP - is the issue on the Philippines side? While it is legal to bring the $$ into the US, it looks like it is not legal to take that much currency out of the Philippines.

What's done is done in that respect. The money is already here. Now the question that the OP has is how to get the money into the bank without raising any undue suspicion from American authorities.

 

[kennedy9]

Taxing Matters: could you provide your feedback also?

 

[davew9128]

The amounts for each trip were $10,000 or less and did not have to be declared. Ergo, not a customs issue.

Missing the point. Entirely. What if on the day in question the converted value of the foreign cash was $10,001?

Oh and BTW, I once served on a Federal jury in a criminal trial for someone accused of smuggling about $11k of cash in. Yeah that question was raised in the jury room during deliberations.

 

[Zigner]

Missing the point. Entirely. What if on the day in question the converted value of the foreign cash was $10,001?

According to the OP, it wasn't. I agree that, if the amount were over $10k, then it could be customs matter, but we only have what the OP tells us to go by...and the OP said that it was under $10k each time.

 

[davew9128]

According to the OP, it wasn't. I agree that, if the amount were over $10k, then it could be customs matter, but we only have what the OP tells us to go by...and the OP said that it was under $10k each time.

Speaking as an international tax expert, I am stating in my professional opinion, it is the only item of importance to me from the OP. In fact, the crime of structuring would jump out me as a possibility here. I'd actually prefer they DID bring in over $10k of cash and declare it. I hear the same advice from people in Vegas would move large amounts of cash with which they wager. Do the 8300 filing and declare the cash, or run the risk of scrutiny for several non-reportable transactions being looked at as an attempt to avoid it.

If he/she were to consult me on the rest, I'd show them the door and say have a nice day after about 10 minutes of my life that I won't get back. It's a complete non-issue.

 

[Zigner]

Speaking as an international tax expert, I am stating in my professional opinion, it is the only item of importance to me from the OP. In fact, the crime of structuring would jump out me as a possibility here. I'd actually prefer they DID bring in over $10k of cash and declare it. I hear the same advice from people in Vegas would move large amounts of cash with which they wager. Do the 8300 filing and declare the cash, or run the risk of scrutiny for several non-reportable transactions being looked at as an attempt to avoid it.

If he/she were to consult me on the rest, I'd show them the door and say have a nice day after about 10 minutes of my life that I won't get back. It's a complete non-issue.

I completely agree. In fact, it's pretty clear that there was structuring occurring. In fact, 31 U.S. Code § 5324 (https://www.law.cornell.edu/uscode/text/31/5324) makes it abundantly clear that it's what happened.

 

[Taxing Matters]

Taxing Matters: could you provide your feedback also?

My view is just slightly different from Dave's. Receiving gifts is not taxable income to you regardless of the value of the gift received. And as a US citizen/resident you generally only need to report gifts from foreign persons if the total gifts given to you during the year from any one foreign person exceeds $100,000. (The rule is different if the gift is from a foreign corporation or partnership, but this is not common). See the IRS page on Large Gifts from Foreign Person for more details. You do need to report cash you bring into the country in excess of $10,000. That's a customs issue, as Dave pointed out.

But where I differ just slightly from Dave is that he seems to treat that as the end of it. I don't. When you deposit that $70k in cash, that will generate currency transaction (CTR) report by the bank to the Treasury Department. The IRS matches your return against the CTR reports looking for possible unreported income. If nothing on the return explains the CTR, you may receive a notice from the IRS about it. At that point you need to provide the IRS the information that the money was from gifts given to you, and the more detail you have to give the IRS on it, the better off you are. It sounds like you have the ability to get evidence of the gifts from relatives and can explain each gift and how it totals up to the $70k you are depositing. That is likely going to be good enough to convince most examiners that it was a gift. This problem could have been avoided had you simply deposited each gift as you got it. But it's not a big deal so long as the IRS is convinced it's a gift. It just takes some of your time to respond to the IRS.

 

[not2cleverRed]

not2cleverRed; I was sharing house with my friends, now I got married and needs a house for my family. I want to see my parents’ love every day in the new house which will be brought using the money and love of my parents: that’s why I did not spend that money despite all the financial issues I have all these years. Sentiments are more powerful than financial burdens.

Your explanation is still not plausible.

I still get the distinct impression that you are testing a story.

I strongly suggest that you shop this story to a local attorney. Maybe they'll agree with TM. Or maybe they'll agree with Dave.