How can I have someone’s money in my bank account and prove in case of a tax audit that it’s not my money?
My cousin is leaving to Mexico and asked me to keep his $10,000 until he comes back. I know theres a certain amount that if deposited to any account, the bank reports it to the IRS. How can I prove in case of an audit that I was just holding it for a while and it’s not my money; Or what would I have to do?
I hate to say this, but tell your cousin not to do you any favors! There is a lot of information missing here such as..does your cousin have financial or marital problems and doesn’t want the account attached? Does he have IRS problems with unpaid taxes, etc? There are a myriad of possible questions here, and you should not get involved at all. Tell him to open an account in his own name or put the cash in a bank safe deposit box. I’m assuming that the 10,000.00 he has was not received by illegal means. You don’t want to have to enlist the services of a tax fraud attorney, should the IRS begin an investigation of your financial affairs along with your cousin’s. DO NOT get involved. Politely tell him you are unable to help him.
Why in the world would you want to do that? You’re opening a can of worms so large, you will mess up your life for a very long time. Don’t do it!