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Will depositing a large sum of cash($100k+) trigger an IRS audit?

Seattle, WA |

If a person who is a business owner has slowly accumulated cash over 20-30 years in a safe and deposits it at a bank, would that person be vulnerable to an IRS audit?

Attorney Answers 1


If the person has paid all the required taxes on the cash and the cash was earned through lawful means, the person does not need to worry about any governmental audit. Even if there is an audit, the conclusion of the government should be to leave the person alone.

The banks are required by the government to notify the government when a customer deposits any fund in specified ways (such as a one-time deposit of $10000 or more or multiple deposits of lesser amounts).

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what if that person did not pay taxes om it? Or how would she prove she did? how would the irs prove she didnt? We are talking about $5,000 a year over a quarter of century.

Thuong-Tri Nguyen

Thuong-Tri Nguyen


Depending on how much income was not reported, there may never be an expiration of the statute of limitations on the governments' ability to collect taxes on unreported incomes. Given that this was a business, there likely are other taxes, besides income taxes, that should have been paid. The person should review in private the specific facts with the person's attorney to find out the legal options.

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