It’s Fix The Tax Code Friday!
This week, there has been a lot of focus on structuring following several high profile cases that made news, including charges against former Speaker of the House Dennis Hastert. Structuring occurs when large transactions are broken into smaller ones in order to avoid bank reporting requirements which kick in at $10,000. If you do that with the intent to evade, it’s illegal.
The actual practice of making cash deposits (or withdrawals) of less than $10,000 is not illegal under the federal statute at 18 U.S.C. § 5324(a); it only violates the law when the transactions are structured “for the purpose of evading” those reporting 1requirements.
I know what you’re thinking: 18 U.S.C. § 5324(a) is not a tax statute. That’s true. Title 18 of the United States Code is the criminal and penal code; the Tax Code is found at Title 26. But structuring is commonly linked to tax evasion or other tax charges (as happened in the FIFA and Hovind matters) since it’s a financial crime.
Some taxpayers suggest that the statute, as written, is merely a trap and that it threatens the freedom of bank customers to make deposits and withdrawals as they see fit. Others, however, note the progress made against prosecuting money launders by relying on the statute.
So today’s Fix The Tax Code question is:
Should structuring stay on the books as a crime? If so, should the $10,000 limit remain – or go higher? Or should the statute be wiped completely?
