Bulletin: NL000021

Date:
April 06, 1993
To:
All Issuing Offices
RE:
Reporting of Cash in Excess of $10,000

Dear Associates:

Introduction. Federal law (26 U.S.C. §6050I ) requires you to report cash received in your trade or business if the cash exceeds $10,000. You must use IRS Form 8300. We generally advise you not to accept cash payments in excess of $2,000.00 for other reasons: risk of theft, risk of counterfeit funds, and a red flag that the cash may be drug money, causing the transaction to be forfeitable.

Cash. Federal law only requires you to report if you receive over $10,000 in cash. Cash means coin or currency of the United States or any other country. It includes United States Notes and Federal Reserve Notes. Regulations do not include cashier's checks, bank drafts, travelers' checks or money orders as "cash" in real estate transactions unless you know that the "instrument" is being used to avoid reporting.

Multiple transactions and multiple payments. Any transactions conducted between you and the payer in a 24-hour period are related transactions. You must aggregate and report them if the total amount exceeds $10,000.

A transaction may be related even if it occurs over a period of more than 24 hours. You must have reason to know that the transaction is one of a series of connected transactions.

If you receive cash installment payments during the year, you must add the initial payment and subsequent payments until the total exceeds $10,000. Then you must file a report. If the subsequent payments exceed $10,000, you must report them separately in (15) fifteen days after the date they exceed $10,000.

Example: On February 10, 1993, X Title Company receives an initial cash payment of $11,000 on a contract for deed. X receives subsequent cash payments of $3,000 on March 15, 1993, $7,000 on April 20, 1993, and $4,000 on May 5, 1993. X must report the $11,000 payment by February 25, 1993. X also must report the payments totaling $14,000 by May 20, 1993.

Date of reporting. You must file the Form 8300 by the 15th day after receipt of the cash. You must keep a copy of the Form 8300 for five years from the date you file. You must provide a copy of the written statement to each person named on the form by January 31 of the year following the calendar year in which the report is made. The statement must show the name and address of the business, the total amount of reportable cash, and that you furnished the information to the IRS. You must keep a copy for your records.

Comprehensive compliance program. Unless you refuse to accept large cash payments, you should establish a written compliance program. It should state that you prohibit actions in violation of the law, it should name an officer to supervise compliance, it should contain a training program, and it should include a quality control program.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
5.16 Escrow Closings
Exceptions Manual:
None
Forms:
None