Who Is Watching Over Your Shoulder?
Every day, millions of international money transfers worth trillions of dollars flow through electronic networks. Financial institutions (banks, Western Union, MoneyGram, PayPal) use domestic (ACH, Fedwire) and international networks (SWIFT, CHIPS). Sending money is strictly regulated by law and monitored to prevent money laundering and terrorist financing. Lawmakers and the Treasury have made sending money easy for honest people, but increasingly difficult for the criminal underworld.
OFAC (the Office of Foreign Assets Control), a division of the Treasury Department, is tasked with examining suspicious financial transfers. Regulations require financial institutions to screen customers’ names, aided by specialized computer services connected to the OFAC database and other law enforcement databases.
Jan Kowalski goes to his bank to send a few thousand dollars to his daughter in Poland. What happens? Basically, not much. The bank vetted Mr. Kowalski long ago, when it opened his account and when it periodically checked its customers’ names against financial intelligence databases. The bank’s computer will also automatically check the name of the recipient. Mr. Kowalski’s daughter is not on law enforcement records, so the transfer will go through without a problem. And that is where the interest of the secret financial services ends.
Formalities After Sending a Gift
If you send money to Poland to your own account, you don’t have to complete any formalities. You can transfer any amount, and you will have no tax or reporting obligations.
If, however, you send a gift from the US to Poland, remember two things:
- In the US: Report the gift to the IRS, but only if you gave one person more than $19,000 in a year (the 2026 limit; IRS Form 709). Tax on the excess is a concern after death only for multimillionaires whose estate exceeds the estate tax exemption set for a given year – in 2026 it is $15 million.
- In Poland: The recipient should report the gift to the urząd skarbowy (Polish tax office) and, if applicable, pay tax on it. Immediate family members classified in the first tax group (spouse, children, grandchildren, parents, grandparents, siblings) are exempt from the tax, provided the recipient reports the gift to the tax office within six months and documents a cash gift with proof of transfer to his or her bank account or by postal money order.
Will the Bank Report the Transfer to the IRS?
No. A transfer of funds abroad is not reported to the IRS, because the IRS is not interested in it, since moving money from one account to another is not a transaction with tax consequences. Your money was already subject to income tax in the year you earned it. When the money is “clean,” the IRS doesn’t care whether you move it from one pocket to another or from one account to another.
The taxman is, however, interested in larger sums of money held abroad. I write about the foreign account disclosure law (FATCA) below, and you can read more in the book “Jak chować pieniądze” (“How to Hide Money from the Taxman”).
Cash Is Different
The common misconception about the IRS tracking us probably comes from the fact that the American taxman is interested in cash transactions, because it is trying to crack down on money laundering. If you bring more than $10,000 in cash to a financial institution, it will report this fact to the Financial Crimes Enforcement Network (FinCEN). Carrying more than $10,000 in cash across the border must also be declared.
Does that mean using cash is illegal? No. You may bring even a suitcase of banknotes to the bank. The clerk will accept the cash and carry out your instructions, but will send a Currency Transaction Report or a Suspicious Activity Report to FinCEN. What will FinCEN do with it? Probably nothing, unless your name is on a list of suspects.
Also remember that since January 1, 2026, money transfers abroad paid for with cash, a money order, a cashier’s check or a similar paper instrument are subject to a federal tax of 1%. It is collected by the company sending the transfer. This tax does not apply to regular transfers from a bank account.
Will the Polish Tax Office Find Out About a Transfer from the US?
No. In Poland, as in the US, moving savings is not a transaction with tax consequences, so banks do not report to the Polish tax office the transactions of law-abiding citizens sending clean money for legal purposes. Your money is clean, because you paid tax in the US in the year you earned the income. If you live in the US permanently and legally, your US income is not subject to income tax in Poland.
If you sent funds to your own account in Poland, keep the documentation confirming the transfer, the statement from your American bank account and your US tax returns, because they may come in handy if, for example, you buy a car or an apartment in Poland and the Polish tax authorities ask you where the money came from. The tax on undisclosed income in Poland is 75% and is an interesting topic for another article.
Gift Taxes for Family in Poland
Family in Poland should report larger amounts to the tax office within 6 months of receipt and, if applicable, pay the tax.
Certain amounts are tax-free in Poland, depending on the degree of kinship. The tax-free limits apply to gifts received within five years and are (since July 1, 2023): PLN 36,120 – if the recipient belongs to tax group I (spouses, ascendants and descendants), PLN 27,090 – for people in tax group II (nephews and nieces, aunts, uncles, siblings of a spouse, spouses of siblings, etc.) and PLN 5,733 – for all other people in tax group III.
The recipient should add up the amounts of gifts from each donor. As long as the total received from one person over the past 5 years does not exceed these limits, there are no taxes and not even an obligation to report the gifts.
The amount of gift/inheritance tax depends on the degree of kinship with the decedent (donor) and on the amount received over the last 5 years. Gifts to immediate family (spouse, children, grandchildren, parents, grandparents, siblings) are completely tax-exempt, provided the gift was reported on time. If not, the tax ranges from 3 to 7% in the first group, from 7 to 12% in the second, and from 12 to 20% in the third tax group.
FATCA
The numerous regulations aimed at making tax fraud and money laundering more difficult were joined by the Foreign Account Tax Compliance Act (FATCA), passed in 2010. As many as 114 countries and territories have agreements with the US to implement FATCA, and as a result most banks in the world identify American taxpayers and report their larger accounts to their supervising institutions. These institutions then pass this information on to the American IRS. Poland cooperates with the US under the Polish-American FATCA agreement, which took effect on July 1, 2015. More on this in the book “Jak chować pieniądze przed fiskusem.”
As you can see, bank secrecy is a thing of the past, but honest taxpayers have nothing to fear, provided they meet the relevant reporting obligations.
Updated October 2026.
