Cash for rent, yay or nay?

Question

Is it OK to receive cash as rent? What are the pitfalls?

Christen G. · Answer

In an ideal world every tenant is paying by ACH/bank transfer or Venmo, right? But paying rent in cash is a fact of life in some communities. If our tenants want to pay cash I have them deposit it at the bank. We give them the last 4 digits of the account, our LLC name and the teller fills in the rest.

Ray Harrell · Answer

No way, and really for the tenants peace of mind. Cash isn't traceable. You can give a receipt, but what if you don't?

Jessica G. · Answer

Cash is a No for me too for safety reasons. I don't want a tenant to know I have that much cash on me.

Account Closed · Answer

Not only is cash a security risk in terms of being robbed, it's also a counterfeit risk.  Many stores now run cash through counterfeit detection machines and call the police when they find any.

Many stock brokerages stopped taking or giving cash in the 1980s when Congress passed the "know thy customer" laws to crack down on money laundering.  Brokerages do everything by check or ACH transfer because they leave a paper trail that can be traced.

Banks convert cash into money orders (for a fee).  My landlord accepts money orders and after a couple of bounced checks, requires either money orders or cashier's checks for the rent payments.

Bob B. · Answer

Why are you wasting time collecting rent. I bet they don't pay their cable bill with cash.

Todd Jenkins · Answer

I inherited a tenant and switched them over to paypal by explaining the benefits for both parties. There's also zelle, cash app, and venmo and I'm sure many others. For me there's no wasted trips to pick up cash and for them they dont have to make a trip to the bank

Jameson Sullivan · Answer

There is that service that Brandon talks about on the podcast all the time... I don't remember what it's called but its where they can pay cash at 7-11 or something and it directly deposits to you.

Bjorn Ahlblad · Answer

I have a tenant who is a guard at a local casino, always wanting to pay in cash, it took some training-he is a model tenant; but cash is too risky.

Cash for rent, yay or nay?

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