Surely if you just dropped 100 million in, something would happen.
In: Technology
Paperwork will be filed, some of it will go to the IRS (or equivalent in your country) and someone, at a minimum the tax man, will be asking questions. People don’t just come into that much money at once, and you bet the government has some rule that says they get a cut of the tax on it and are salivating as they read the paperwork.
Exact details vary by country, but largely this is what I would expect to have happen.
Both the bank and your local government will enquire about the source of the funds, and it will be filed and taxed as whatever form of income is approximate in that jurisdiction, assuming the crypto sales are legal. I would imagine they would lock or severely restrict movement of the funds if it seems suspicious until you’re legally cleared.
Assuming you sell your bitcoin in bulk from a platform, there will be a wire transfer from the buying platform to your bank. If the amount is significant, they will take some time to process it and they will notify the IRS so you better be ready to pay taxes.
You can kind of compare it to winning the lottery. Taxes and a whole lot more people that want your money
Besides the tax implications everyone is talking about, the sucking up would commence forthwith.
In addition to the tax considerations, you’ll get a senior banker contacting you with helpful ‘advice’ on how they can help you deal with all that money
Have you ever watched Pretty Woman?
Well, in your scenario, the bitcoin winfall is Richard Gere, you are Julia Roberts, and the bank is the various store clerks all sucking around looking for scraps.
You may want to look at contacting a large financial institution with advisors, brokerage accounts and a bank such as Schwab so you have a plan of what to do with your funds after you cash out of crypto. Not that your bank isn’t good, but professional planning can help you. In addition, you might want to talk to a law firm about setting up a trust.
In most countries, the bank will tell the government about it automatically.
When you sign up for the bank account, you had to give a lot of information and some form of ID. This is known as KYC, Know Your Customer. These details are kept by the bank for situations like this.
They don’t report every transaction you make, but certain suspicious or large transactions will be reported to the appropriate authorities, usually the part of the government handling tax evasion or money laundering.
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