goodfellowsmansfield.com

By Laura M. Cosse

Rumors, confusion, accusations and half-truths abound when this single question is asked: Is cash gifting legal? In case you are not sure what cash gifting is, let me start with a brief description.

Cash gifting has existed in its current home income opportunity form for the last six years. Basically, cash gifting is operating under the U.S. tax laws found in the IRS Tax Code, Title 26, Sections 2501-2504 and 2511. The law states that one or more individuals can give a gift to another individual of up to $12,000 each per calendar year without any tax liability to either the giver or receiver of the gift. These gifts are not included in the gross income of the recipient.

Cash gifting programs are offering their participants the chance to give and receive financial gifts in accordance with the above laws. The amount of the gifts given and received varies depending on which gifting activity you join, but generally gift amounts range from $100 to $3500. A person is only allowed to receive gifts up to the amount that they have given, so if a person has given $500 they are allowed to receive gifts up to $500, but not in excess of that. Although a person only gives a gift one time, they are allowed to receive gifts from many different people, making this opportunity potentially lucrative for each person involved.

There are many people who are stating that this activity is illegal and that the IRS will soon be cracking down on everyone involved in the various programs. In order to shed some light on this complex and confusing question, we called the IRS and, with their permission, recorded the call and their answers to our questions. The following questions were transcribed from that phone call, if you would like to listen to the entire call please contact us directly. Also, there is a similar call you can hear to the FTC if you would like, the following is the conversation to the IRS.

1. How does giving and receiving gifts work in regards to IRS tax laws? Would it only be the IRS and FTC that would be involved?

A. You are allowed to receive up to $12,000 from any individual without having to pay any taxes on it and it is the responsibility of the person giving the gift to file the paperwork with the IRS, if you receive a gift under $12,000 it is not taxable so you don’t need to worry about reporting it.

2. Do you have to report the interest off of the gift?

A. Yes, if you receive a gift and put it in the bank and it draws interest, then the interest is taxable.

3. If a single person receives multiple gifts that add up to more than $12k, are they responsible for the taxes on that gift?

A. No, because it is the amount that is given by the giver of the gift, not the receiver, that must be under $12,000 in order to not be taxed. The gift itself is not taxable but the income it produces is.

4. Should I generate paperwork documenting that a gift was received?

A. Yes, that is what you should do in case there is any question you can document from where you received this money.

5. Do you have any records on file of a system such as this that is known to be a scam?

A. No, I never heard of any program like this before, how did you hear about it?

B. Through videos on Veoh and YouTube.

6. Is it legal to make a video and post it to the public, letting them know that this activity is in place?

A. As long as they aren’t promising anything that they can’t deliver or scamming people it’s fine. As long as the giver can also receive and it’s not all one person who is making the money, as long as everyone has an opportunity to receive it sounds fine.

7. When would it be illegal, when someone feels like they’ve been cheated?

A. Right.

8. Can an individual solicit for a gift? How is that different from a Charity? When would an individual soliciting for a gift break the law?

A. A charity has the right to solicit for gifts, but an individual would be breaking the law as soon as they offer a tax deduction for the gift given.

9. So if a person tried to use the IRS as leverage to receive a gift, then that would be illegal?

A. Right, because you can’t take a deduction on giving a gift to an individual.

10. What about if a person just said that this gifting program exists and you can join, would that be illegal?

A. As long as you don’t promise anything you can’t deliver.

So, clearly the IRS has no problem with gifting programs as long as they are not promising anything that they can’t deliver, such as guaranteeing that an individual will receive money. I truly hope that you will look deeper into this phenomenal concept that is cash gifting; it has blessed our family tremendously and I hope that it will do the same for you and yours.

About the Author: Laura Cosse is a full-time internet marketer who leads a large and successful team in her cash gifting activity. She is the mother of 2 year old twin boys and is expecting her third son in August, 2008. You can find out more about Laura and her cash gifting activity by visiting CashGiftingForLess.com or emailing her directly at CashGiftingForLess@gmail.com. You can also view her numerous videos at youtube.com/user/CashGiftingForLess

Source: isnare.com

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