Chain Letters – Cash Gifting Once Upon a Time
Before the advent of the Internet, cash gifting was called the chain letter. The way this program worked was you were to send a set amount of money to four or five people on your list you were provided, and then you made a new list with the top name removed, and the other names moved up one spot with your name at the bottom. You instructed those you sent your mailing to do the same. They in turn did the same and it goes on and on and on.
In each of the letters you received, there was always a statement that this had been checked out by an attorney and the U.S. Postal Office and both said it was perfectly legal. In the chain mail letter, you were told you were sending your money to each person for a report they had and you were paying to receive this information. Of course it was a ruse and usually consisted of only one sheet of paper with a few words on it, but that was supposedly making it all legal. It was all hype as chain letters are illegal.
To participate in these chain letters was expensive as you were told you needed to mail to at least 100 people to get the right number of people who would participate and you would receive your untold thousands of dollars in your mailbox. So you had the cost of postage, printing your new letter and copying them to send out to all 100. To be really successful you were encouraged to send out 200-500 letters which would increase the amount of money you would receive into the tens of thousands of dollars.
From Chain Letters To Cash Gifting
Then came the Internet and the Chain Letter program entered into the 21st century. It changed from chain letter to cash gifting. By asking people to join your cash gifting program via Email, you were only dealing with people who were truly interested in joining your program. They had to contact you for the plan details and be signed up under you. No more huge up front expenses like in the chain letter, and your audience was the world. While you still had the expense of sending the people on your list their money, at least you were not mailing blind as with the chain letter.
Many of the Cash Gifting programs today are designed to look like anything but a cash gifting program. Others claim you are joining a private club, and only club members can participate in their program. Others just say they are a cash gifting program. No matter what the title, they all have one thing in common: They all claim they are legal and the IRS has said so. They reference Title 26 of the IRS Code that deals with estate cash gifting. Notice I said “estate” cash “gifts.” So what does this mean? The IRS says that a couple may “gift” up to $26,000 per year to anyone of their choosing to reduce their estate tax liability. A single person can “gift” up to $13,000.
The Truth About Title 26 of the IRS Code
But wait a minute you just proved that cash gifting is legal since the IRS allows “gifts” under Title 26 of the Code up to $13,000 for a single person and up to $26,000 to a couple. Right? Actually I did not prove that cash gifting is legal, but I did prove that “gifts” were legal according to the IRS Title 26 of the Code. You see cash gifting has nothing to do with estate “gifts.” NOTHING.
What the Cash Gifters do not tell you is that under Title 26 of the Estate “Gifts” section, there is a sentence they omit from their spiel, and it is this: “You must have ABSOLUTELY NO EXPECTATION OR RECEIVING ANYTHING IN RETURN FOR YOUR GIFT.” (emphasis mine). That means you cannot receive something back for giving your “gift” or it is null and void and not a tax deduction. In a cash gifting program the only reason why you are giving is to receive a cash gift in return for your cash gift. Let’s be real, otherwise you would not participate. There are many more things the cash gifters will tell you trying to convince you their program is legal, but there is no way I can cover them all in this piece. In my book: Robbing You With A Keyboard Instead Of A Gun – Cyber Crime How They Do It, I devote an entire chapter to Cash Gifting where I go into all the technical, statements, and the issues of Cash Gifting; and why it is illegal.
Are You Prepared To Go To Jail?
You need to know that people have gone to prison for running and participating in these illegal cash gifting pyramid schemes. But all you really have to know is this: Cash Gifting is illegal in all 50 states and the FTC (Federal Trade Commission), as well as in almost every country in the world. So don’t take my word for it. You can go to the FTC website (www.ftc.gov) and type in cash gifting and you can read what the FTC says about it, or for that matter do the same for your state Attorney General. If you have any questions you would like to ask me, just contact me at Eagle Research Associates here.