Withdrawing cash by a partner form joint bank account

[daniel845]

What is the name of your state? Florida

I have joint account with my friend in a bank. Many times, he withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated as he alone got that cash, or will it be treated as if I and he have withdrawn together and got it together?

 

[Just Blue]

What is the name of your state? Florida

I have joint account with my friend in a bank. Many times, he withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated as he alone got that cash, or will it be treated as if I and he have withdrawn together and got it together?

Treated by whom?

 

[daniel845]

(i). Treated by my friend's potential creditor, who is suing my friend, in case the creditor wins the case.

(ii). Treated by bank

(iii). Treated by IRS for tax purposes (he is using that money as part of a business).

 

[adjusterjack]

(i). Treated by my friend's potential creditor, who is suing my friend, in case the creditor wins the case.

The creditor will "treat" the account as all the money in it belongs to your friend. Should the creditor win a judgment the creditor may go to court and have the bank account levied. Your friend will have notice of the levy and an opportunity to raise objections and defenses in an effort to prevent the levy.

There are others here that might suggest what those defenses, if any, might be.

(ii). Treated by bank

The bank will, of course, obey any court order directing the disposition of the levy and will have no choice in the matter.

(iii). Treated by IRS for tax purposes (he is using that money as part of a business).

The IRS isn't really going to care about the bank account but will care about taxing any earnings that the business may make.

My advice to you is to get your share of the money out of that account right now.

 

[Taxing Matters]

What is the name of your state? Florida

I have joint account with my friend in a bank. Many times, he withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated as he alone got that cash, or will it be treated as if I and he have withdrawn together and got it together?

When you say "partner" do you mean he is a business partner, life partner, or what? Is this a business bank account, or just a joint personal account? Is he writing checks for business expenses or for personal things? The answers to those questions will make a difference in what is going on here.

The IRS isn't really going to care about the bank account but will care about taxing any earnings that the business may make.

The IRS might very well care. The answers to the questions I asked matter.

 

[quincy]

Is the account a daniel845 and friend account, where both signatures are required for withdrawals, or is the account a daniel845 or friend account, where either you or your friend can withdraw funds?

In other words, would the bank allow you to withdraw all of the funds in the account without your friend’s authorization?

I am confused by your statement that your friend uses the account for part of “his” business.

 

[daniel845]

We are just friends, both are male, and we have our own families (separate wives and children). This is a joint account, and there is OR between our names and anyone can withdraw and anyone can deposit. This is not business bank account, just a personal checking account on both of our names (sorry for bringing “business” into this).
Many times, my friend withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated by his future creditor, once the creditor wins the case, if the friend alone got that cash, or will it be treated as if I and friend have withdrawn together and got it together?

 

[quincy]

We are just friends, both are male, and we have our own families (separate wives and children). This is a joint account, and there is OR between our names and anyone can withdraw and anyone can deposit. This is not business bank account, just a personal checking account on both of our names (sorry for bringing “business” into this).
Many times, my friend withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated by his future creditor, once the creditor wins the case, if the friend alone got that cash, or will it be treated as if I and friend have withdrawn together and got it together?

The entire account is vulnerable to debt collection action. Sorry. I am sure that is not what you (or your friend) want to hear.

 

[Zigner]

Will those withdrawals be treated by his future creditor, once the creditor wins the case, if the friend alone got that cash, or will it be treated as if I and friend have withdrawn together and got it together?

If the money was withdrawn by your friend alone, then he, alone, received the money.

 

[quincy]

If the money was withdrawn by your friend alone, then he, alone, received the money.

... but all of the remaining money in the account can be levied, regardless of daniel845’s interest in it.

 

[Zigner]

... but all of the remaining money in the account can be levied, regardless of daniel845’s interest in it.

Yes, I know...but the OP has asked several time how the specific withdrawals will be treated.

 

[Taxing Matters]

If the money was withdrawn by your friend alone, then he, alone, received the money.

Again, that depends on details we don't know. I asked some questions earlier for a reason.

 

[quincy]

This is not a business account. It apparently is an account between two friends who set it up apart from their own families, for some curious reason.

Because they (apparently) had no conditions set up on use of the funds, it sounds as if a judgment creditor could use all funds in the account to satisfy a judgment against one or both of them.

 

[zddoodah]

I have joint account with my friend

Why?

he withdrew cash form that account, by writing a check on his name alone. Will those withdrawals be treated as he alone got that cash, or will it be treated as if I and he have withdrawn together and got it together?

I don't understand the question. For starters, writing a check and making a withdrawal are two different types of transactions. Also, treated by whom? For what purpose? Also, why wouldn't it be "treated" as if the payee on the check got the cash, as opposed to either of you. To whom did your friend write the check?

Treated by my friend's potential creditor, who is suing my friend, in case the creditor wins the case.

Why would you think such a creditor would ever become aware of this check that your friend wrote?

Treated by bank

This still makes no sense. The bank only cares that the person who signed the check was authorized to do so. Since it's a joint account account, your friend presumably has that authority.

Treated by IRS for tax purposes (he is using that money as part of a business).

The IRS would rarely become aware of a single check written by a taxpayer. Why do you think the IRS would care about this particular check.

I hope it goes without saying that it's quite unusual for two "friends" to have a joint checking account and that whatever concerns you have could be allayed by closing the account.

 

[quincy]

You can use a check made out to yourself as a way of withdrawing funds from your account.