Many businesses operate with cash transactions. The government is very specific about these types of transactions and they can be, unfortunately, costly to anyone not reporting correctly.
The underground economy in general is a target for the IRS and the government itself. For this reason, specific laws exist for cash transactions. Any business transaction done in cash over $10,000 must be reported to the IRS on Form 1300, Report of Cash Payments Over $10,000 Received in a Trade or Business. This form is readily available.
Some of these forms are called Currency Transaction Reports.
It is extremely important that these are filed correctly because those that do not file the correct forms and the IRS finds out, you be audited, fined, and even charged with criminal activity. This is perhaps one of the most important aspects of business tax reporting.
