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Title 26, Internal Revenue CodeRelease 119-73

§6867 Presumptions Where Owner of Large Amount of Cash Is Not Identified

Title 26 › Subtitle Subtitle F— Procedure and Administration › Chapter 70— JEOPARDY, RECEIVERSHIPS, ETC. › Subchapter A— Jeopardy › Part III— SPECIAL RULES WITH RESPECT TO CERTAIN CASH › § 6867

Last updated Apr 6, 2026|Official source

Summary

If someone is found holding more than $10,000 in cash and will not claim it as their own or name an owner the IRS can readily identify who acknowledges it, the IRS may treat the entire amount as taxable income for that year, taxed at the highest individual rate, with the possessor treated as the taxpayer for collection purposes. If the true owner is later assessed instead, the new assessment relates back to the date of the original one for lien and collection purposes. Cash includes equivalents such as foreign currency and bearer obligations.

Full Legal Text

Title 26, §6867

Internal Revenue Code, Source: USLM XML via OLRC

(a)If the individual who is in physical possession of cash in excess of $10,000 does not claim such cash—
(1)as his, or
(2)as belonging to another person whose identity the Secretary can readily ascertain and who acknowledges ownership of such cash,
(b)In the case of any assessment resulting from the application of subsection (a)—
(1)the entire amount of the cash shall be treated as taxable income for the taxable year in which the possession occurs,
(2)such income shall be treated as taxable at the highest rate of tax specified in section 1, and
(3)except as provided in subsection (c), the possessor of the cash shall be treated (solely with respect to such cash) as the taxpayer for purposes of chapters 63 and 64 and section 7429(a)(1).
(c)If, after an assessment resulting from the application of subsection (a), such assessment is abated and replaced by an assessment against the owner of the cash, such later assessment shall be treated for purposes of all laws relating to lien, levy and collection as relating back to the date of the original assessment.
(d)For purposes of this section—
(1)The term “cash” includes any cash equivalent.
(2)The term “cash equivalent” means—
(A)foreign currency,
(B)any bearer obligation, and
(C)any medium of exchange which—
(i)is of a type which has been frequently used in illegal activities, and
(ii)is specified as a cash equivalent for purposes of this part in regulations prescribed by the Secretary.
(3)Any cash equivalent shall be taken into account—
(A)in the case of a bearer obligation, at its face amount, and
(B)in the case of any other cash equivalent, at its fair market value.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

1988—Subsec. (b)(2). Pub. L. 100–647 substituted “the highest rate of tax specified in section 1” for “a 50-percent rate”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1988 AmendmentAmendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.

Effective Date

Pub. L. 97–248, title III, § 330(c), Sept. 3, 1982, 96 Stat. 620, provided that: “The

Amendments

made by subsections (a) and (b) [enacting this section] shall take effect on the day after the date of the enactment of this Act [Sept. 3, 1982].”

Reference

Citations & Metadata

Citation

26 U.S.C. § 6867

Title 26, Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73