Originally Posted by freedave
The various gyrations I have been going about here are due to you depositing the check with a Brokerage Firm. I do not have any experience with a brokerage firm, even vicariously. When you make your withdrawals, distributions or collect dividends or whatever, that is when you should make your demand. I hesitate because thinking about it, what I have to compare this to is interest bearing accounts. If you are not going to allow your bank to capitalize on fractional lending with your paychecks then you do not have the right to demand interest off the money you are lending your bank. There is a kind of deposit (irregular?) where you have arranged for your bank to keep the exact same cash for your withdrawal - no mingling of funds. Redeeming lawful money is kind of like that but you do not get any interest. Often when somebody begins redeeming lawful money they find the bank has changed their account to interest-free.
I am thinking the brokerage firm considers your "investment" as interest-bearing. They may want the freedom to grow your money by conventional fractional lending too; I don't know.
If you are redeeming lawful money by demand then somebody like a boss or brokerage firm reporting you to the IRS is simply Notice that you would give anyway should you want to get a refund or withdraw money without the scope of the Fed. There are a lot of suitors who are self-employed and they do not send in withholdings. But they will send returns with evidence of redemption so that the IRS does not evaluate their tax liability in absence of a return.
I believe that you might want to treat your brokerage firm like a boss, not a bank. Do not involve them with your redemption of lawful money. While your money is with the brokerage firm I am presuming that your funds with them are tax free until you withdraw.
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