The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: "Carry Tax"||Date: 7/18/2005 9:56 PM|
|Author: ptheland||Number: 80076 of 124931|
But is not unexplained large sums of cash generally considered a potential tip-off for unreported income.
Yes, it is. Unless the IRS has lost all ability to think reasonably since Phil left. ;-)
No matter how many affidavits OP has from witnesses who also saw the cash stashed under the floor, that really does not answer the question of whether grandfather properly declared his income.
I was thinking of the person actually doing the depositing when suggesting that. How did THEY get their hands on that much currency? Discovering the cash hoard when settling their grandfather's affairs is a potentially reasonable explanation. And since they will be the ones making the deposit of cash, they are the one that will likely be reported on the cash transaction report. I've never actually seen one, but I suspect they will need to identify themself rather than their deceased grandfather.
There are actually two people with potential problems stemming from this cash hoard - the grandfather and whomever actually takes the cash to the bank. The person taking the cash to the bank would be the first one with an issue. Once that is resolved to the IRS's satisfaction as coming from an estate, the question moves to the grandfather. How did HE come into the cash hoard? That will, by far, be the more difficult issue to deal with. Especially since the grandfather is not available to answer questions.
Any chance that the IRS would consider a "lifestyle" audit (not sure if my terminology is correct, but I suspect (and hope) that you understand me) WRT to grandfather? Maybe 40k is under the threshhold, but I suspect that there is some number that would interest them - 400k, or 4M, etc.
Absolutely. It would be prudent for the executor/administrator of the estate to keep some funds in the estate to protect against this possibility. There is also a process to request a prompt assessment of taxes due. While it would not preclude an audit, it should trigger one if one is coming. But it would allow the executor to finalize the estate as far as the IRS is concerned.
(and thanks for your patience)
That was my attempt at poking some fun at your habit of signing off with "curiously". Patience with people willing to learn is one of my long suits.
|Copyright 1996-2016 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|