Form 8300 - Reporting Cash Payments of Over $10,000 to the IRS
California State University, Fullerton is required by law to report receipts of more than $10,000 in a single transaction (or two or more related transactions) in cash or monetary instruments (cashier’s check, bank draft, traveler’s check, or money order) that is received in the course of the University's trade or business per Internal Revenue Code (IRC) § 6050I. The University must file each reportable transaction with the Internal Revenue Service (IRS) and the Financial Crimes Enforcement Network (FinCEN) on Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business.
When does this requirement apply to payments made at Cal State University, Fullerton?
The University must file Form 8300 to report cash paid to us if it is:
- Over $10,000,
- Received as:
- One lump sum of over $10,000,
- Installment payments that cause the total cash received within one year of the initial payment to total more than $10,000, or
- Other previously unreportable payments that cause the total cash received within a 12-month period to total more than $10,000,
- Received in the course of your trade or business,
- Received from the same buyer (or agent), and
- Received in a single transaction or in related transactions.
Under Federal tax laws, State colleges and universities are required to file Form 8300 upon receiving, for one transaction or two or more related transactions, more than $10,000 in cash (for example, tuition & fees or housing payments) in the course of their trade or business of providing educational products and services, regardless of the fact that the money may be excludable from gross income under IRC § 115. The IRC § 115 income exception is distinct from, and does not relieve an educational institution of, the requirement under section 6050I to file a Form 8300 information report. Thus, both UC and CSU system institutions are required to file Form 8300 information report using the FinCEN U.S. Department of Treasury system potentially for tuition or housing payments (i.e. related transactions) more than $10,000 over a period of a year.
If the University Cashier, unit or department receives cash (currency and coin) payments that total more than $10,000 from one customer as a result of a single transaction or two or more related transactions, an IRS Form 8300 is required to be filed within 15 days of receipt of such cash. A transaction may not be divided into multiple transactions to avoid the filing of Form 8300.
What Is Cash?
By Federal tax law definitions under Code § 6050I, for Form 8300 reporting cash is defined as:
- The coins and currency of the United States and
- A cashier’s check, bank draft, traveler’s check, or money order you receive, if it has a face amount of $10,000 or less and you receive it in:
- A designated reporting transaction (defined later), or
- Any transaction in which you know the payer is trying to avoid the reporting of the transaction on Form 8300.
Cash does not include a cashier’s check if it constitutes the proceeds of a bank loan. Personal and business (corporate) checks drawn on the payer’s own account as well as electronic payments (ACH transactions) or credits are excluded and not considered cash payments. The filing of Form 8300 does not apply to wire transfers.
What Is A Related or Designated Reporting Transaction?
Under Federal tax laws, any transactions between the University and an individual that occurs within a 24-hour period are related transactions. For California State University, Fullerton, such transactions may include tuition and housing payments. If we receive over $10,000 in cash during two or more transactions with one individual in a 24-hour period, we must treat the transactions as one transaction and report the payments on Form 8300. Transactions are related even if they are more than 24 hours apart if we know, or have reason to know, that each is one of a series of connected transactions (for example tuition and housing payments made by students).
How Does Cal State Fullerton Report Payments Made Over Time?
To comply with Federal tax laws, if the first payment is more than $10,000, we must file Form 8300 within 15 days. If the first payment is not more than $10,000, we must add the first payment and any later payments made within one year of the first payment. When the total cash payments are more than $10,000, we must file Form 8300 within 15 days.
After we file Form 8300 with FinCEN, we must start a new count of cash payments received from that individual. If we receive more than $10,000 in additional cash payments from that individual within a 12-month period, we must file another Form 8300. We must file the form within 15 days of the payment that causes the additional payments to total more than $10,000. If we are already required to file Form 8300 and we receive additional payments within the 15 days before we must file, we report all the payments on one Form 8300 filing with FinCEN.
Scenario 1: A Fall term payment of $10,500 is received in cash as follows: $4,000 in July and $6,500 in August.
The $11,000 in total cash payments for Fall Term tuition and related fees are paid within 12 months of each other, making these cash payments reportable on Form 8300.
Notifications and Annual Reporting Requirements
Each individual is notified and given a written statement if a Form 8300 is to be filed (Click here for a sample of that letter) at the time the reportable transaction occurs. Annually, a notification is prepared and furnished to each individual noting the name and address of the University, the name and phone number of a contact person, and the total amount of the reportable cash we received from the individual during the year. The statement must also state we are reporting this information to the IRS. The notice must be sent by January 31st of the year after the year in which we received the cash that caused us to file the Form 8300 within the FinCEN system.
Charitable contribution gifts and donations made to California State University, Fullerton are not reportable to the IRS because the IRS does not consider these transactions as being received in the course of conducting university business. This includes auction of property in which the buyers can receive a charitable contribution deduction for their income tax returns.
The University is required to retain copies of the completed Form 8300 and annual statements for a minimum of five (5) calendar years from the filing date.
Please note the University may be subject to severe penalties for non-compliance by the IRS.
If you have any questions regarding the above information or the referenced documents, please contact the University Tax Compliance Manager at (657) 278-5671.
CALIFORNIA STATE UNIVERSITY, FULLERTON DOES NOT ASSIST IN TAX PREPARATION, ACT AS A TAX CONSULTANT FOR INDIVIDUALS OR ENTITIES, PROVIDE TAX ADVICE, AND CANNOT ANSWER YOUR TAX QUESTIONS. PLEASE CONSULT A TAX PROFESSIONAL, THE IRS, OR A FINANCIAL PLANNER WHO IS PROFICIENT WITH TAXATION WITH YOUR TAX QUESTIONS.
WHILE THE UNIVERSITY HAS MADE EVERY EFFORT TO USE THE MOST CURRENT AND ACCURATE DATA REGARDING THE 2017 TAX YEAR REPORTING, TAX LAWS CHANGE FREQUENTLY, AND IT IS POSSIBLE THAT SOME OF THE INFORMATION MAY NO LONGER BE ACCURATE. THE INFORMATION PROVIDED IS REGARDING SPECIFICALLY THE 2017 TAX CALENDAR YEAR AND SHOULD NOT BE INTERPRETED TO APPLY TO PAST OR FUTURE TAX YEARS. THE UNIVERSITY DISCLAIMS ALL LIABILITY FROM THE MISTREATMENT OF INFORMATION AND MATERIALS CONTAINED IN THIS DOCUMENT. INFORMATION REGARDING IMMIGRATION, EMPLOYMENT, AND TAX SUBSTANTIAL AUTHORITY ARE THE RESPONSIBILITY OF EACH INDIVIDUAL. PLEASE KEEP IN MIND THAT NO ONE FROM CALIFORNIA STATE UNIVERSITY, FULLERTON, WHILE IN THEIR OFFICIAL ROLE AT THE UNIVERSITY, CAN ACT AS A TAX CONSULTANT, GIVE PERSONAL, LEGAL, OR TAX ADVICE, OR REPRESENT AN INDIVIDUAL DEALING WITH THE INTERNAL REVENUE SERVICE (IRS). THUS, ANY ASSISTANCE THE ABOVE INFORMATION MAY PROVIDE IS GIVEN AS A COURTESY TO YOU, AND AS SUCH, SHOULD NOT BE CONSTRUED IN ANY WAY AS THE RENDERING OF LEGAL OR TAX ADVICE.