Owe $100 million or more to the Internal Revenue Service (IRS)? Better write that check now.
The latest edition of the Internal Revenue Bulletin, Bulletin No. 2015?36, dated, September 7, 2015, has this to say about the Federal Revenue?s new check policy.
The Federal Reserve will not accept checks that are larger than $99,999,999.00 and agencies have been directed to return these checks to the originator. Beginning January 1, 2016, IRS will begin returning checks for more than $99,999,999.00 to the originator.
The notice was posted in the latest edition of the Bulletin under headings for income tax, gift tax, estate tax, self-employment tax, employment tax and excise tax.
A signed check by Dwight D. Eisenhower during his first term as the 34th President of the United States. Image credit: National Numismatic Collection at the Smithsonian Institution.
To be fair, the IRS isn?t trying to make it more difficult for multimillionaires to pay their tax bills. Rather, this is a reminder of a ruling previously announced by the Bureau of Fiscal Service (BFS) applicable to all federal agencies. The rule as outlined in that notice states the large check policy per the Treasury Financial Manual (TFM), Volume 1, Part 5, Section 2060 that ?agencies must not accept any check written for more than $99,999,999.99, as the Federal Reserve will not process checks over that amount.? The Federal Reserve Banks Operating Circular 3, Section 3.2, states that the Federal Reserve Banks do not handle any checks over $99,999,999.00. No, that?s not a typo: it is indeed a 99 cent spread. I?m not sure why the numbers are differen but this discrepancy, of course, brings up the real question of what happens if you write a check for, say, $99,999,999.25? My recommendation is that you not try this at home.
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