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RE: Oct 15 final 2017 tax deadline: Share your tax horror story with BlockTrades

in #blocktrades6 years ago (edited)

My worst tax year was 2016/2017 as we had bought a house from the government at foreclosure for cash. After the purchase, we had several large cash deposits made into our account to cover the payment of workers via certified checks. That is when we found out that if you deposit more than 10k in cash in a single business day there are special forms to fill out. As we didn't know this in advance we made deposits over 10k 4 times in a single week to pay for new A/C wall units and to have them installed. This was a huge red flag to them and triggered an audit. The cash was simply taken out of one account and placed into a new account and that was little matter to them. We learned our lesson as we had to pay income on the deposited cash as it went into a business account from our personal account. Had we knew that we simply would have paid from our personal account to begin with but as it was an LLC and the units were for the office section of the house we thought we had proceeded correctly.

Worst part is we had no income for 2016/2017 as we were remodeling.

Live and learn.