While there's no explicit legal limit to how much cash you can keep at home in the United States, storing large amounts of cash can potentially invite tax trouble if not handled carefully. Here's what you need to know to stay on the right side of the law:

1. Legality of Keeping Cash at Home. You're legally allowed to keep as much cash as you want at your home. The government does not regulate how much money you can keep in your house. Money isn't taxed; income is. As long as you paid income taxes when you earned the money, the government generally doesn't care how much of it you store at home.

2. Reporting Requirements for Cash Transactions. * Form 8300: If you're running a business and receive more than $10,000 in cash in a single transaction or related transactions, you must report it to the IRS using Form 8300. This applies to various types of businesses, including those dealing in jewelry, furniture, boats, and real estate. * Related Transactions: Transactions are considered related if they occur within a 24-hour period. They can also be related even if they occur over a longer period if the recipient knows, or has reason to know, that each transaction is one of a series of connected transactions. * Cash Definition: For Form 8300 reporting, "cash" includes U.S. currency and coins, as well as foreign money. It also encompasses cash equivalents like cashier's checks, bank drafts, traveler's checks, and money orders. * Filing Deadline: You must file Form 8300 within 15 days after the date you receive the cash. * E-filing: Form 8300 can be filed electronically through the Financial Crimes Enforcement Network’s BSA E-Filing System.

3. Bank Reporting Requirements. * $10,000 Threshold: Banks are legally obligated to report cash deposits of $10,000 or more to the IRS. This is a measure to help the government detect potential crime and fraud, including money laundering. * Suspicious Activity: Banks might also report transactions they deem suspicious, even if they're below the $10,000 threshold. Frequent cash deposits of amounts just under $10,000 could be flagged. * Structuring: Breaking up large deposits into smaller transactions to avoid reporting (known as "structuring") is illegal.

4. Potential Issues with Storing Large Amounts of Cash.

• Proving Legal Source: If law enforcement finds a large amount of cash in your home, they might seize it under civil forfeiture laws, suspecting it's related to illegal activity. It then becomes your responsibility to prove the money's legitimate source. Keeping records of how you acquired the cash is crucial.
• IRS Audits: While keeping cash at home isn't illegal, large or frequent cash deposits or withdrawals can increase your chances of an IRS audit. The IRS cross-checks tax filings with forms like W-2s to ensure income is correctly reported. Underreporting income is a significant audit trigger.
• Cash-Intensive Businesses: Businesses that deal primarily in cash are subject to greater scrutiny during IRS audits because of the higher potential for underreporting income.
• Safety and Security: Keeping large sums of cash at home makes you a target for theft, fire, or other loss. Cash is not insured against such losses.

5. How to Avoid Tax Trouble.

• Report All Income: Accurately report all income on your tax returns.
• Keep Good Records: Maintain detailed records of all income sources, transactions, and expenses.
• Document Large Cash Transactions: If you deposit or withdraw large amounts of cash, document the source of the funds. If you own a business that regularly deals in cash, create a written policy for employees to follow and provide a copy to your bank.
• Avoid Structuring: Never break up transactions to avoid reporting requirements.
• Be Aware of Audit Triggers: Avoid common audit triggers, such as underreporting income or taking excessive deductions.
• Consider Alternatives: Instead of storing large amounts of cash at home, consider depositing the money in a bank account or investing it.
• Consult a Professional: When in doubt, consult a tax professional or attorney for guidance.

By understanding the rules and potential pitfalls, you can legally store cash at home without inviting unwanted scrutiny from the IRS.