26 U.S.C. § 6867
Section 6867 · Presumptions where owner of large amount of cash is not identified
Amended 2 times on record
Applied in 13 court decisions — leading case Commissioner v. Hendrickson (1989)
Most recently applied in Commissioner of Internal Revenue, Petitioner-Cross-Respondent v. Leon E. Hendrickson, Respondent-Cross-Petitioner, and Peoples Loan & Trust Company (April 1989)
How often courts cite this section
Court decisions citing this, by year.Markers show enactment, consequential amendments, and circuit splits over this section — watch for a citation surge after a change or a disagreement. The dip in the last several years is a data-coverage gap, not a real trend — our corpus holds fewer opinions from the most recent years, so recent citations are undercounted.
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,
then, for purposes of sections 6851 and 6861, it shall be presumed that such cash represents gross income of a single individual for the taxable year in which the possession occurs, and that the collection of tax will be jeopardized by delay.
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).
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.
For purposes of this section—
(1) Cash
The term “cash” includes any cash equivalent.
(2) Cash equivalent
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) Value of cash equivalent
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.
Editorial notes U.S. Code · Office of the Law Revision Counsel
Amendments
1988—Subsec. (b)(2). Pub. L. 100–647 substituted “the highest rate of tax specified in section 1” for “a 50-percent rate”.
Effective Date of 1988 Amendment
Amendment 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
Section 330(c) of Pub. L. 97–248 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].”