Cashier's Check Distinguished
Unlike a personal check, a cashier's check is backed by bank funds rather than the funds in your personal checking account. However, you provide the bank with funds to cover the cashier's check at the time of purchase, either with cash you brought into the branch or funds deducted from a bank account you have there.
Reporting to IRS
In accordance with the Bank Secrecy Act, financial institutions that receive $10,000 or more from a customer in exchange for a cashier check or other negotiable instrument must report the transaction to the IRS. This is true whether the $10,000 threshold was met during a single transaction or over the course of multiple related transactions. For example, if you purchase one $5,000 cashier's check, the bank is not likely to report the transaction. However, if the cashier's check is one of several, bringing the total amount of your transaction to $10,000 or more, the bank must report the series of transactions. The bank may also report your $5,000 cashier's check if the transaction appears suspicious, even if you engage in no other transactions.