What Is Legal About Cash Gifting?
I was recently invited to give a large gift of cash to a stranger. This is not the first time I have been involved in a gifting endeavor. I decided to do some research into the cash leveraging system to see if this form of gifting is legal or not. Please note: this article only shares what I have discovered that makes a gifting program legal. It does not address the intricacies of what could make such an activity illegal albeit I give a general idea of that. There is plenty of material available to make a case either way. If you are considering a gifting program with likeminded people be aware of the gifting laws. Wikipedia has a good overview. The U.S. gifting rules are found in the IRS Tax Code Title 26 Sections 25012504 and 2511.
This article is for informational purposes only so for you who are thinking to join a gifting activity I urge you to do your own research to satisfy yourself as to whether or not you think participation in one of these gifting programs is legal. Please be conscious that gifting done in an illegal way has been successfully prosecuted in a number of states. The tax law does not make gifting legal or illegal; it simply tells you the tax consequences of the arrangement. Be aware that calling it a gift doesn’t necessarily make it one. When determining the tax effects the tax law will look at whether the intent was truly to donate when the gift was given.
All of this said I will now share what I am seeing has been upheld for keeping gifting legal. Across the board those people whose verbiage is focused on helping people and the giving of the gifts from the heart wanting to do something wonderful for someone else without expecting anything in return seem to be the ethical gifting programs. Those who focus on the big cars and big houses are obviously involved in gifting for the purpose of making money.
Of course when someone decides to get into gifting they know that eventually it may be their turn to be a receiver but this is not the answer that a judge will align with should someone in a gifting program end up in court. Truly gifting means that which is given is a gift. For example when you give a toy to a child for her birthday you dont expect to get anything back in return right? So when you give a gift of money likewise you should not expect to receive anything in return! This is what a true gift is; this is the heart and soul of legal gifting.
In my own research and discovery I have found many folks who are promoting gifting programs are stepping over the line with the way they are publicizing their programs. In other words they are emphasizing this activity as a way to make lots of money.
If you are thinking of getting involved in a gifting activity understand that gifting is not a business. Period. There is no selling of anything no solicitation its not a commercial enterprise there is no company it is not an investment it is not conducted for profit it is not network marketing or MLM there are no public gatherings and there is no service provided. If you see a website inviting you to a homebased business and if it turns out that the business is gifting I advise you to run the other way.
If you are already involved in a gifting program take a look at the words that you are using when inviting people to participate or that are used on a webpage that is included in your system. Terminology used in a gifting activity are very important they can be the fine line between keeping it legal or not. Below is a sampling of words to never use as well as words that should be used. This is by no means a complete list.
This is a sampling of words that are not used in a gifting activity: Buy in Downline Earn Earnings Getting paid Guarantee I made Income Investment Make Make money Multiply your money Net Paid earnings Paid out Pay Payout Profit Purchase Recruit Return on your money Sign up Sponsor Sure bet Took in Upline You will make
This is a sampling of the words used in a gifting activity: Activity Associates Care Community Constitutional Rights Family Fellow man Free association Gift Gifter Give Giving Golden Helping others I gave I have gifted I have received Invitation Invite Invited by Kindness Nice people Participant Participation Receive Register your gift Sharing
Gifting has been used in cultures around the world throughout history. In today’s modern world be persistent with your research so you know what you are doing and can participate ethically.
About the writer: Chava LeBarton taught fine art for 15 years cofounded an internet animation software company and is a commercial real estate investor. She currently empowers others to realize real prosperity while helping others do the same. Visit http://www.HighwayToAbundance.com.
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