Confessions of a Bank Teller: 7 Compelling Reasons to Avoid Depositing Over $10K in One Go
Handling money and deciding where to store it can be tricky. To clear things up, we spoke with bank teller Rachael P., who has a lot of experience with how people deal with their money, especially when depositing it at a bank. She advises against depositing more than $10,000 in one go. Instead, she suggests making smaller, more frequent deposits. Here’s why:
1. **Triggers a Currency Transaction Report**: Depositing $10,000 or more in cash means the bank must file a Currency Transaction Report. This report includes your identity, Social Security number, address, and other personal details that go to the federal government. You can avoid this hassle by keeping deposits under $10,000.
2. **Raises Suspicion**: Even if your money is legitimate, a large deposit might look suspicious and suggest possible money laundering. This can lead to internal bank reviews and investigations, which are best avoided.
3. **Delays Deposits**: Filing a Currency Transaction Report can slow down your deposit. Bank tellers need to fill out extra paperwork and secure the cash until everything is processed, which can take hours or even a day.
4. **Increases Bank Risk**: Large cash deposits can make the bank a target for robbery. Banks have limits on how much cash they can store, and exceeding these limits poses security risks.
5. **Risk of Seizure**: If the bank suspects illegal activity, large deposits could be seized by the federal government during an investigation. Keeping deposits smaller helps avoid such complications.
6. **IRS Reporting**: All Currency Transaction Reports are sent to the IRS, which looks for any irregularities in wealth or income. Smaller deposits help you avoid unwanted IRS scrutiny.
7. **‘Know Your Customer’ Procedures**: Large deposits require extra steps to verify your identity and the source of the funds. This is to ensure the money isn’t linked to illegal activities.
Due to the redundant paperwork, security risks, legal obligations, and tax implications, Rachael emphasizes that there’s no benefit to depositing over $10,000 at once. Making smaller, more frequent deposits under $10,000 is a simpler, safer approach.