As titled, what should we consider when withdrawing a large amount of money (>100K) from a bank account? Do we need to document the purpose of our withdrawal?
From what I could have found:
- withdraw in cash – bank reports it to IRS no matter what. Would this affect my tax filing in the coming year?
- withdraw in check – bank does not seem to report it. Is this correct?
- wire-transfer to another person's account – would this always be slapped with a "gift tax"?
And do we have to document what we do with that money?
To elaborate a bit more (in response to the comment and answer provided by others to my original question):
In the U.S., what documents do we need to prepare in case our large sum withdrawal from the bank triggers a flag in relevant government (local and/or federal) divisions and they decide to investigate? Does the (local/federal) government care if we stash our money (in cash or check) under our mattress, if we purchase foreign properties (taxable? documents needed for proof?), or if we give it away (to individuals or organizations - individual: a gift tax, organization: tax waivable)?
I had come across this article and was blown away by what was stated in the article. It seems that no matter what we do (except spreading thin our assets to multiple accounts in multiple banks), the government will always be notified of any large bank transaction and we would be forever flagged since. Is this correct?