Does anyone know the legaility of cash gifting?

Question

Does anyone know the legaility of cash gifting?

Answer 1

Cash Gifting Legal or Cash Gifting Illegal

Cash gifting is legal and happens all the time.

The most common occurrence is when a newly married couple is purchasing their first home and need assistance coming up with a reasonable down payment.

In 2007, the IRS will allow a gift (any gift be it cash, real estate, or some asset that has value) up to $12,000 to be given tax free.

In the case of newlyweds, it is usually their parents that provide the gifts and the gift amount can be as high as $96,000 tax free by way of gift splitting.

Here’s how:

There are four parents gifting to two children – son and daughter or son in-law and daughter in-law.

Each parent can gift $12,000 to each child. So, that is $24,000 from each parent. $24,000 x 4 = $96,000 tax free cash gifts from the parents. If they wanted to gift more than $12,000, then any amount over the $12,000 would be considered income and add to their adjusted gross income for that year.

Don’t get mad at your parents if they didn’t give you a cash gift for a down payment on a house. It’s a gift—remember?

Cash gifting is an activity that is proliferating with the advent of the internet. Since the IRS allows anyone to receive up to $12,000 tax free from as many people as there are willing to send it to you, then you can see why people are doing it.

Most cash gifting groups have a web server with a database that automates the gifting process. Remember those chain letters in the seventies where you send money to the name at the top of the list and add your name to the bottom and send the letter to 10 people? Antiquated, manual, snail mail. Cash gifting with a sophisticated database server makes it all work in a legitimate efficient manner.

Here is a link to a site I found that answers many questions regarding cash gifting and its legality:

http://www.cashgiftingcashgifting.com/ca...

The only other issue is with the delivery or sending currency in the mail. You're not supposed to do that. It is very hard to enforce because of the federal regulations that protect the contents of a letter or package as soon as it enters the US mail system, be it USPS, FedEx, UPS, etc…

If the government was going to enforce sending cash in the mail, then that would mean Grandma would be going to jail for sending a $5 bill in a birthday card, but not after she filed a civil suit for invasion of privacy.

There is a cash gifting group that has addressed the issue of sending currency by allowing its members to accept a bank certified check or money order instead of cash.

Here is a link to their site:

http://www.overnightcashexplosion.com/ca...

Cash gifting is legal and can be lucrative. As with any venture, do your homework before jumping in.

Hope that helps :-)

Answer 2

The answer is: it depends. Some programs are very legal (with legal agreements, no issues with laws), and some are clearly board games and pyramid schemes.

The best resource with the clearest information I have found is at: http://www.legalgiftingprograms.com

I actually spoke to the guy who runs the site, and he really knows his stuff. I hope this helps.