Laws

• According to the financial reference websites BankRate.com and BankingQuestions.com, there are, as of December 2010, no laws, either state or federal, that explicitly prohibit you from keeping money in a safe deposit box. In fact, there are no federal laws at all that restrict what you place there. While certain items are, of course, illegal for people to possess and store -- stolen property, illegal drugs, banned weapons -- cash is not one of them.
  
  

Leases

• When a person takes out a safe deposit box, the bank generally requires a signed lease to rent the space. The lease will outline what you can and cannot keep in the box. By signing it, the renter agrees to the contract's terms. Usually, these will forbid the storage of patently illegal or dangerous items -- such as explosives -- but a contract could forbid the storage of cash.
  
  

Bank Liability

• Although a bank may technically forbid certain items from being stored in a safety deposit box, most banks will make no effort to verify whether clients comply with these regulations. Banks do this for two main reasons. First, they wish to respect the privacy of their customers. Second, according to BankRate.com, if a bank becomes aware that its clients are storing illegal items, it could become liable to do something about it; many banks find it better to look the other way.
  
  

IRS Regulation

• David McGuinn, a representative of the company Safe Deposit Specialist, based in Houston, Texas, tells BankRate.com the misconception that it is illegal to keep cash in a safe deposit box may come from an IRS regulation making it illegal to conceal cash to avoid paying taxes on it. Yet, while having this regulation, the IRS does not forbid the storage of money in a safe deposit box.