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Box 2a or 2b for Business Account Deposit Over 10k

Answered by: 
Randy Carey

Question: 
If we have a business, and the business owner makes a deposit into the business account for over $10k, I need to know if the business owner is box 2a or 2b? Example: Business is owned by John Smith. The business name is ABC Shop LLC DBA ABC Store. So since John is the owner would he be conducting on his own behalf or person conducting transaction for another? I was thinking it would be 2a since 2a & 2b seem to apply.
Answer: 

From the instructions:

Item 2

a. Person conducting transaction on own behalf
b. Person conducting transaction for another
c. Person on whose behalf transaction is conducted
d. Courier service (private)

Since the transaction is on behalf of the entity, Option 2b should be selected for reporting the involvement of John Smith in the transaction.

A second 4A record should be created for the entity (ABC Shop LLC DBA ABC Store) with option 2c selected.

Editorial note:

Virtually the only time a business owner depositing to the business's account would be recorded as making the deposit on his own behalf is when the business is a sole proprietorship owned by the individual.

First published on 10/27/2014

Filed under: 
Operations
Filed under operations as: 
BSA
IRS Tax Forms

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