Here's What Happens if You Wire Someone a Lot of Money

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• Under the Bank Secrecy Act of 1970, financial institutions must report wire transfers over $10,000 to the IRS.
• The Act is designed to flag criminal activity and does not impact the average consumer.
• It's up to consumers to work with a credible financial institution.

When you wire money from your savings or checking account, it is transmitted electronically, and no physical money is exchanged. The transfer may be facilitated by a bank or nonbank money transfer provider. Most people transfer money when they need funds processed quickly or when moving a large amount of money.

Large wire transfers do not go unnoticed, whether it's to buy property, pay tuition, make an investment, or support a family member. Under the Bank Secrecy Act (BSA) of 1970, certain transactions must be reported to the Internal Revenue Service (IRS). Here, we take a closer look at how it works.