Real Cash Gifting
Cash Gifting, the real Cash Gifting, is quite simple. It is simply a means of transferring wealth from one individual to another without incurring unwanted costs such as taxes. Any tax accountant could tell you there are no special tricks, no traps, and no hidden secrets to gifting cash to someone, as some would have you believe. Instead, when it comes to the gifting of cash, real Cash Gifting, there are only four simple things you need to know and understand: 1) Cash Gifting is not new, 2) Cash Gifting is not Multi Level Marketing 3) Cash Gifting is not a business and 4) Cash Gifting is perfectly legal. Chances are if you don’t know these things about Cash Gifting already it’s a reflection on the economic circles that you travel in or the opportunities that you create for yourself or the fact that you don’t pay enough taxes to make Cash Gifting worthwhile.
Think of this …
On a warm spring day you come home from school and find your parents sitting at the table making plans. You also notice a suitcase by the door. Since your mother is clearly upset you ask what’s wrong hoping that your parents aren’t springing a sudden divorce on you. Don’t worry it’s not a divorce. There’s been a death in the family. Your great Uncle Maynurd passed away and your mother is on her way to pay her respects. Although you didn’t know much about Uncle Maynurd he was actually loaded. In fact, he’s been sending you $12,000 as a gift for your college fund every year. Now that he passed away the executer of his estate has identified you and many others to receive a $12,000 gift. You think that’s pretty cool until you find out how much the whole estate is worth, the little cash gift is nothing, but it’s the limit that you can receive in a year from Uncle Maynurd or any one individual without having to report it as income. Like many wealthy people, Uncle Maynurd had more money than he could ever use, cash gifts were just a normal part of distributing his assets.
And just in case you’re wondering, you will not need to bring a big bag for the cash or expect it to arrive via FedEx, UPS, or any other courier at your door in an overnight box.
Cash Gifting Is Not New
Here’s how simple it is if that was too much …
Have you ever gotten cash for your birthday? Probably a little.
Have you ever given someone cash for graduation? Probably a little more.
Have you ever bought a car and had someone help with the down payment?
How long do you think that has been going on?
Did you ever report any of those as income or think it was illegal?
Hopefully you realize that wealthy people leave money behind to other people to inherit when they die every day. That’s part of the purpose of a will and having what’s known as an estate plan. Since wealthy people have dying and people have been inheriting fortunes long before Paris Hilton, you then realize that in the same way Cash Gifting is nothing new. The amount may change, such as being raised to $12,000 per year, but the concept is still the same. It follows along the same lines as having a business and hiring you kids.
Both are credible entries on an itemized tax return. No one invented it a few years ago just as YouTube did not make it credible. What’s new to you is just that, new to you.
Cash Gifting Is Not Multi Level Marketing
Although the current cast of characters may look, think, and act the same as they do in Multi Level Marketing (MLM), Cash Gifting is not and could never be MLM. One of the key aspects is that it is a private activity between individuals. This means that unlike MLM there should be no weekly meetings, and no one is “sponsoring” anyone into a business. The main problem is that MLM can’t work and yet so many people believe it can and join up. Those people applied the same paradigms or way of thinking and simply substituted a worthless product for cash.
Cash Gifting Is Not A Business
According to Google there are immediately several definitions of business…
Definitions of business on the Web:
* a commercial or industrial enterprise and the people who constitute it; “he bought his brother’s business”; “a small mom-and-pop business”; “a …
* commercial enterprise: the activity of providing goods and services involving financial and commercial and industrial aspects; “computers are now widely used in business”
* business concerns collectively; “Government and business could not agree”
* the volume of commercial activity; “business is good today”; “show me where the business was today”
* a rightful concern or responsibility; “it’s none of your business”; “mind your own business”
* occupation: the principal activity in your life that you do to earn money; “he’s not in my line of business”
* an immediate objective; “gossip was the main business of the evening”
* incidental activity performed by an actor for dramatic effect; “his business with the cane was hilarious”
* clientele: customers collectively; “they have an upper class clientele”
The basic premise behind real behind the examples as stated above; birthdays, graduations, etc. is a simple private exchange between individuals. This cannot be and enterprise because as stated people (plural) constitute an enterprise. It cannot fall under the second definition because there are no goods and services being provided. If you gave the lady who cleaned your windshield at the stoplight $5 and went about your merry way, you could argue there was a service. If you just give it to her as she holds up a sign in the median, it’s just a gift. Even though the answer to ‘What is Cash Gifting’ usually entails a specific reference to a section of the IRS code Cash Gifting per say is not a business. Do not expect to take a tax write off for any subscription fee to a program, do not try and deduct your telephone or office space as a result of being involved in this activity. It is not reported as income as long as it remains below the specified level, there is no profit made.
No income, no profit, no business.
Cash Gifting Is Perfectly Legal
As I was talking one day to a friend he surprised me. This friend as it turns out had joined a Cash Gifting program a while back. When we talked about it, he told me he didn’t have much luck with it because he never felt good about it. One of the things he said was “Yeah, it’s legal. But it’s just barely legal.”
Well that’s an interesting perspective. For one thing using the law or legality rather as a baseline for engaging in an activity is a pretty low standard. Think of all the things big corporations do that are legal that are far from moral or in the best interests of their customers. They realized long ago that there is no barely legal at all, it is or it isn’t. And what they want is an ability to argue while they reap the benefits. This particular activity does not fit that mold. It’s just like any other part of the tax code that we are subject to when it comes to income and what has to be reported.
Bottomline On Cash Gifting
Hopefully this shreds some misconceptions on the Cash Gifting that has been referred to as a phenomenon. If it is a phenomenon it’s one that financial planners, lawyers, and accountants among others have been tuning their wealthy clients into for years. While it’s not new gifting cash is a stable a wealth distribution. Wealthy people have benefited for years and will continue to do so, the difference now is that you too have this same information you can make Cash Gifting a stable for you as well.