Reporting Requirements : Buying

What we are required to tell the government

When you buy from us

The reporting requirements have evolved from Anti-Money Laundering laws over the last few decades. These rules are related to both anti-money laundering requirements and to ensure that money being received is not money derived from illegal activities.

What is reportable?

If it is a cash transaction that is:

Over $10,000
- Received in one lump sum or
- Installment payments over the course of a year (starts from the first payment) that total more than $10,000
From the same person
Received in a single or related transaction (defined below)

What is considered CASH?

US or foreign coins or currency
Cashier’s checks, money orders, bank drafts or traveler’s checks that are LESS than $10,000 in face value.

What is NOT considered CASH

Any payment that is drawn out of an individual’s personal account is NOT considered cash. This includes bank wires, ACH payments, personal checks, credit card, debit card or paypal payments.
It is currently unclear whether cryptocurrencies, like BitCoin is considered cash.
Some examples of both reportable and non-reportable transactions are:

Scenario 1:

You buy $12,800 worth of gold coins and silver bars and pay using $8000 in US currency and a cashier’s check of $4,800.

Reportable?

Yes. Since the cashiers check is less than $10,000 it is considered cash. As such, the total cash you have given is $12,800.

Scenario 2:

You buy $12,800 worth of gold coins and silver bars and pay using $1,800 in US currency and a cashier’s check of $11,000.

Reportable?

No. Since the cashier’s check is more than $10,000 it is not considered cash. As such your total cash payment is only $1,800.

Scenario 3:

You buy gold bars for $33,000 and pay using a personal check for $25,000 and $8,000 in US currency.

Reportable?

No. Any payment, regardless of the amount drawn from your personal account is NOT considered cash. The cash payment is less than $10,000

Scenario 4:

You buy gold Canadian Maple Leaf coins for $12,000 and make a payment in US currency for $8,000 on April 2. You make another US currency payment on April 15 of $4,000 and receive your gold coins.

Reportable?

Yes. These are considered installment payments and are combined to total more than $10,000.

A more detailed explanation and definitions can be found on the IRS’s website here

http://www.irs.gov/pub/irs-pdf/p1544.pdf