Is it structuring to have many bank accounts?

[JerrySpringer]

I was reading on another forum how someone got a windfall inheritance in cash and needed advice. One reply was to add it to their bank account periodically in small deposits. That was called structuring and is illegal (remember Spitzer?) according to another reply. So, when we have many bank accounts to make deposits and buy coins with, etc, is that structuring technically? And if not, how do banks or the government for that matter ever know the aggregate value of those accounts? Do you think banks report account values routinely to the fed with SSN info and then the fed can see who is mysteriously having money move around from account to account?

[68Camaro]

No idea what "structuring" is (guess that's something else I'll have to look up), but if the windfall was of such a large amount that it would have created inheritance taxes then anything they do to avoid those taxes would be a problem if they were found out. If the inheritance wouldn't have generated taxes then it wouldn't matter how they do it IMHO - in that case if they prefer to keep it low profile and want to split it into little piles I believe that's their business.

[JerrySpringer]

No idea what "structuring" is (guess that's something else I'll have to look up), but if the windfall was of such a large amount that it would have created inheritance taxes then anything they do to avoid those taxes would be a problem if they were found out. If the inheritance wouldn't have generated taxes then it wouldn't matter how they do it IMHO - in that case if they prefer to keep it low profile and want to split it into little piles I believe that's their business.

The OP received $30,000 but the catch is it was in cash and not disclosed in the will. So, paper trail is basically zero about how they came into the cash and they needed advice what to do with that amount of money. Structuring is basically regularly placing allotments of cash into a bank account, usually in large sums but below the $10,000 flag. Banks have been told to track this behoavior too and report it. Eliot Spitzer supposedly was doing this when he got caught in his prostitute patronage fiasco back in 2008:

http://en.wikipedia.org/wiki/Eliot_Spit ... on_scandal

[68Camaro]

The money is theirs. It doesn't need to be disclosed. It's no one's business. AFAIK it is not illegal to deposit money that is yours in any amounts you choose. The only issue would be if their mutiple $9900 deposits raised a flag and the government claimed that they were doing something illegal, and then confiscated it lacking that they had proof it was theirs. So their question really is what do they need to do to fly under the radar. That one I can't really answer with any certainty. When the government chooses to operate illegally themselves then all bets are off.

[IdahoCopper]

Tell the OP to come over here and start buying AG.

[JerrySpringer]

The only issue would be if their mutiple $9900 deposits raised a flag and the government claimed that they were doing something illegal, and then confiscated it lacking that they had proof it was theirs.

I've wondered sometimes if I got pulled over by a police officer and I had a bazillion boxes of coins in the car whether they would give me the third degree or what not about that. I hate making small, patronizing type talk with LEOs. I seldom believe they are doing it because they are curious necessarily. Just MHO, but they are trained to look for things. We could probably all share some stories about being pulled over, but seems that a person having anything more than a few dollars and some credit cards in their wallets is cause to try a phishing search.

[JerrySpringer]

Tell the OP to come over here and start buying AG.

The OP got many replies. Here is the reddit post:

http://www.reddit.com/r/personalfinance ... literally/

[knibloe]

My question would be why put it in the bank at all?

Also, in regards to the coin question and getting pulled over, I have wondered that myself. First would be to tell them that I collect coins. Second would be to have them call the bank that orders them for me.

I never use it, but i ahve a small scale in the car. I keep it with a coin collecting book. That way, I can explain that I weigh them to make sure they ar not fakes.

If they really want to harrass you, there is nothing that you can do or say to stop them.

[68Camaro]

Looked up structuring. Another of those vague laws intended (probably) for good but liable to be twisted by a devious DA who is using the system for his own purposes.

I believe they would need to show a pattern of purposeful intent to hide an illegal activity. Certainly having and using multiple bank accounts for safety and convenience shouldn't fall into that. But it's wise to keep asking yourself on a regular basis - as the times change - if your existing accounts make sense.

There really isn't a strong need to put money in a bank these days as knibloe notes, except as a convenience to pay bills.

[johnbrickner]

Something not yet brought up is once you have assets on the radar, you become a target for people who want what you have. It's good to have an emergency fund in cash but beyond that, I'd advise structuring (not the illegal way) it so the rest doesn't show up on the "I want it and can get at it" radar. Holding it in cash outside of the bank will keep it off the radar. Holding it in PM you have in hand keeps it off the radar. I understand holding it in a retirement account will protect it but, I'm not an attorney. A motivated paralegal will have enough knowledge to go after a sum this size. Don't ask me how I know this. Stay under the radar.

Regarding coin boxes in the car. Time to clean up the back seat of empties.

[Morsecode]

The banks, the feds, they can easily apply logorithms to look for just about anything unusual.

I visited branches of a certain bank over 800 times last year, and my account number was captured each time. No transaction was more than $250...the vast majority were under $40. Don't think for a minute someone somewhere in the bank's food chain isn't scratching their head wondering why

I'm sure we have member sorters here who have numerous structured dump accounts and pick up accounts.

[Engineer]

If your intent is to "structure" your deposits to avoid suspicious activity reports, you're structuring. On the other hand, there's nothing wrong with wanting to diversify your holdings between banks for added safety.

John's advice on keeping under the radar is always a good thing to consider. Having assets on the books makes you a big fat target.

[creshka46]

First of all, if I was going to receive an inheritance like that, I'd just go ahead and do it the legit way. Money received from an inheritance is not taxable to to recipient but it would only be distributed out after the estate itself is taxed. However, the threshold for triggering estate taxes is quite high (somewhere around $5 million I think) so this $30,000 probably wouldn't be taxed anyway. Granted, I'm just assuming that the total estate is less than $5m.

However, if he did wish to not disclose this, I would say a good route to go would be to start using this cash to pay for as much as possible: groceries, gas, clothes, car repairs, etc. and then he'd be able to save that much more from his paychecks. It doesn't have that instant gratification feeling, but he could probably work through $30,000 in 2-3 years and then he would be sitting on a savings account of equal value that was funded entirely by his own paychecks, not some mysterious cash lump sum.

[DTEJD1997]

If I am not mistaken, "Structuring" is "specific intent" crime. You have to have intent to evade financial reporting, tax evasion, etc.

If you are spreading money to diversify risk, or to take advantage of promotional offers from banks...I doubt that could be construed as "structuring".

If it is only $30k, I would not worry too much...

[Tourney64]

Structuring is usually done at 1 financial institution. If you make several similar transactions just under the $10K reporting limit (Can't remember what the limit is these days), that would be structuring. You financial institution would be required to submit an SAR (Suspicious Activity Report) on you to the Feds. The lower financial amounts would fall under the radar and typically larger amounts would be done to hide illegal activity. If you performed the task at several branches within the same Bank, it would most likely get reported also.

[highroller4321]

First of all, if I was going to receive an inheritance like that, I'd just go ahead and do it the legit way. Money received from an inheritance is not taxable to to recipient but it would only be distributed out after the estate itself is taxed. However, the threshold for triggering estate taxes is quite high (somewhere around $5 million I think) so this $30,000 probably wouldn't be taxed anyway. Granted, I'm just assuming that the total estate is less than $5m.

However, if he did wish to not disclose this, I would say a good route to go would be to start using this cash to pay for as much as possible: groceries, gas, clothes, car repairs, etc. and then he'd be able to save that much more from his paychecks. It doesn't have that instant gratification feeling, but he could probably work through $30,000 in 2-3 years and then he would be sitting on a savings account of equal value that was funded entirely by his own paychecks, not some mysterious cash lump sum.

I believe the limit was brought down to $1M. I also believe that there are certain rules about what you can inherit that has to be taxed. I am not an attorney so don't quote me on anything.

[highroller4321]

The money is theirs. It doesn't need to be disclosed. It's no one's business. AFAIK it is not illegal to deposit money that is yours in any amounts you choose. The only issue would be if their mutiple $9900 deposits raised a flag and the government claimed that they were doing something illegal, and then confiscated it lacking that they had proof it was theirs. So their question really is what do they need to do to fly under the radar. That one I can't really answer with any certainty. When the government chooses to operate illegally themselves then all bets are off.

Except if anyone anytime, that has access to the information, has a problem you are required to prove how you got every last penny. I did a few deals last year and was depositing cash into my account. Week 1 $5k Week 2 $0 Week $3k Week 4 $1.2k Week 5 $8k. The bank LOCKED my account. I could not deposit or withdraw any money from my account. I had to be apart of a 3 person conference call about where the money came from. I explained that I had a few items that I was holding onto and decided to sell them. They asked if I was doing this as a business. I said no. They asked why I didn't deposit it all at one time and I explained it was 4 separate transactions from 4 different people. They were not satisfied with this information and said they were closing my account and I had 48hours to empty my account or I would be getting a check in the mail. I was also informed that I was banned from opening another account at their bank for 3 years.

Luckily I know a lady who is pretty high up in the bank and she was able to save my account from being closed. If it was not for her then I would have been banned from banking there. Yes, this was one of the 5 largest banks in the US.



So no it isn't anyone's business....but somehow it becomes their business.

[highroller4321]

I was reading on another forum how someone got a windfall inheritance in cash and needed advice. One reply was to add it to their bank account periodically in small deposits. That was called structuring and is illegal (remember Spitzer?) according to another reply. So, when we have many bank accounts to make deposits and buy coins with, etc, is that structuring technically? And if not, how do banks or the government for that matter ever know the aggregate value of those accounts? Do you think banks report account values routinely to the fed with SSN info and then the fed can see who is mysteriously having money move around from account to account?

If you deposit more then $10k into an account at anytime the bank has the option to file a report to the IRS saying you did so. It really depends on the bank on how they handle this. Most banks fill out the form, but don't send it into the IRS. This way they have record of it, but don't have to do anything about it. A few banks make the report and file and some banks don't do anything.

That being said if there was 3 bank account and they all had active random activity it would be hard to be traced. However, if you ever got audited, or looked into then yes I believe you could be charged for structuring. I am not a lawyer though so don't quote me on this.

[68Camaro]

... When the government chooses to operate illegally themselves then all bets are off.

...
So no it isn't anyone's business....but somehow it becomes their business.

Unfortunately that's the side effect of a government out of control. At the moment the law is still on your side but... to defend your view you have to be willing to sue to defend your rights. The bank would have lost but your costs would have been ridiculous, and they know that, which is why they so often get away with this crap. Very sad.