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Is there a flag or trigger on large transfers out of the U.S. that may trigger an audit?

Brooklyn, NY |

I'm a non resident, owner of a U.S. based LLC company. I get distributions every month and the funds have accumulated in my U.S. accounts. I've appropriately filed taxes, but would like to avoid triggering an audit or investigation by my transfer. The sum is just over $1M and would be transferred to my overseas permanent residence bank.

Attorney Answers 7


  1. There's virtually no chance that a transfer of that amount would not result in some scrutiny under the Patriot Act, etc. However, if you have properly handled the reporting associated with the funds along the way then you'll be fine. No need to fear any type of investigation of you've handled things properly. You may also want to consider providing details fo the transaction prior to the transfer.

    Good luck.

    Evan A. Nielsen is licensed to practice law in California and handles federal tax matters throughout the U.S. The information provided here is for educational purposes only and is not intended as legal advice for a particular matter. This response does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult an attorney.


  2. I defer to Mr. Neilsen as a tax practitioner.

    My comment is that a company of your size really needs to have a minimum legal team of a CPA and attorney. Avvo questions are for analysis only, not advice. At the level of activiity and profitablity you are discussing, such a team is warranted.

    The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.


  3. I agree with the prior responders. Set up an appointment with an experienced attorney and CPA to discuss the matter in private not on a public non-confidential forum.

    If this answer is helpful, then please mark the helpful button. If this is the best answer, then please indicate it. Thanks. For further information you should see an attorney and discuss the matter completely. If you are in the New York City area, then you can reach me during normal business hours at 718 329 9500 or www.mynewyorkcitylawyer.com.


  4. No attorney on this site is going to tell you how to avoid an audit on a transfer of that magnitude. Spend some of that money on a U.S. tax attorney and you might get an answer that you can live with and rely on.

    If you'd like to discuss, please feel free to call. Jeff Gold Gold, Benes, LLP 1854 Bellmore Ave Bellmore, NY 11710 Telephone -516.512.6333 Email - Jgold@goldbenes.com


  5. All my colleagues gave you proper advice. I would only add that here you do not only have a problem of audit. Analyzing wire transfer is a normal activity for banks. If your activity is legitimate and properly reported the second issue concenrs the distribution of dividends. With 1M distribution it is very risky not to have an international tax attorney assessing the overall tax planning and tax consequences in your jurisdiction. Tax administrations can exchange information as well. Best

    This reply is offered for educational purpose only. You should seek the advice of an attorney. The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than an educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the undisclosed individual asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of New York. Responses are based solely on New York Law unless stated otherwise. Pursuant to Internal Revenue Service guidance, be advised that any federal tax advice contained in this written or electronic communication is not intended or written to be used and it cannot be used by any person or entity for the purpose of (i) avoiding any tax penalties that may be imposed by the Internal Revenue Service or any other U.S. Federal taxing authority or agency or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.


  6. I disagree with my colleagues to some extent; if the funds are not from an illicit source and you are engaged in a lawful business and you paid your taxes, the government has no business regarding your funds. All that will happen most likely is a routine report to FINCEN regarding the transfer which by itself would be unremarkable unless other circumstances are present. Are we all supposed to live in constant fear of the US government when engaging in lawful activities?

    This is not legal advice but a general comment on society based on a limited set of hypothetical circumstances. No one should act or refrain from acting based on these comments without seeking appropriately licensed legal or professional advice. The author disclaims all liability in respect to actions taken or not taken based on his comments.


  7. If you are entirely tax compliant, I am not aware of a tax problem or any other legal: DEPENDING on where you are sending the money and how you are using the funds.

    I do however agree with the others to the extent that--strictly speaking--an audit can be triggered.

    Total Mobility Law is an international law firm that lets companies do global business with the knowledge and confidence they need to comply in any country. Our answers on this site do not constitute legal advice, nor do they establish an attorney-client relationship. The only thing that can do that is a signed Engagement Letter and Fee Agreement, which you can get by contacting us through www.totalmobilitylaw.com.

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