I am a freelancer that runs a small design business (LLC) and I have one client in particular that I regularly do more than $10k per month worth of business with. Sometimes I'll deposit a check for $14k in one shot. I have check stubs and a paper trail for all of this and file all of my tax returns properly and on time.

My concern is that because I'm often depositing more than $10k at a time that this is going to raise red flags with the government. Should I be concerned about this? I have never had any problems with the IRS and my income level has slowly but steadily increased over the past 10 years. I am a 38 year old homeowner and have XXX,XXX in the bank split between two checking and three savings accounts, one of them being a high yield savings account.

  • 2
    Have you tried calling the IRS or talking to an accountant? This type of legal advice probably won't be answered here. Commented Sep 12, 2014 at 18:11
  • 5
    Are you thinking of restrictions on cash transactions? Checks come with a paper trail and don't have anywhere near the flags that cash does.
    – AndrewS
    Commented Sep 12, 2014 at 20:46

4 Answers 4


You're getting confused between several different things.

  1. 10K - cash transactions over $10,000 are reported to FinCEN under BSA. This is to prevent money laundering.

  2. IRS - IRS wants to see your tax return with all your income reported there. They don't see your bank deposits unless they audit you.

1 and 2 are not related at all.


Contractors regularly deposit checks like this; if the income is legitimate don't worry.

Report it to the IRS as income whether or not the customer issues you a 1099. With deposits like this you should be making quarterly payments to the IRS for your projected income.


I do not think banks have an obligation to report any deposits to the IRS, however, they probably have an obligation to report deposits exceeding certain threshold amounts to FinCEN. At least that's how it works in Canada, and we're known to model our Big Brother-style activities after our neighbour to the South.


Your main concern seems to be to be accused of something called 'smurfing' or structuring.


Depositing money amounts (cash or checks) under the 10k limit to circumvent the reporting requirement.

People have been investigated for depositing under the limit, e.g. small business owners.

If you're always above 10k you should be fine, as your deposits are reported and shouldn't raise IRS or FBI suspicions.

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