What Are Cash Gifting Programs? Don’t Fall Victim to This Scam

Any time someone talks about a way to make a boat load of money, it will probably at least make you stop and think. Cash gifting programs are one of those things that to me sounds like you want no association with. Please correct me if I’m wrong, but my interpretation of cash gifting is anything but a good idea.

I’ve heard this idea come up in a few recent discussions, and wanted to find out what it is myself. I’m no expert on the topic, but from first glance it screams “SCAM.” Maybe there are some legitimate cash gifting programs, but I don’t see anything legitimate about these programs at first glance.

There may be some loopholes that make it completely legal, but that doesn’t make it safe or necessarily a legitimate way to make money.

What is Cash Gifting?

Interestingly, when you search Wikipedia for “cash gifting,” it redirects you to “pyramid schemes.” That’s no good.

With some further research, here’s how I think cash gifting works…

  • Legally, cash gifting is a tax strategy to give money away in order to reduce your tax bill. In a calendar year, you can give $12,000 to as many individuals as you like, and the receiver does not have to pay taxes on the gift.
  • Now for the shady approach: You join a “cash gifting program” by paying an enrollment and monthly membership fee disguised as cash gifts to the people who joined before you. As a member, you receive money from any new members that you recruit.

Typically, members get roped in by the hype. They probably know it is a risk and not exactly legitimate, but the “what if…” factor makes people act irrationally.

These programs are doomed to fail from the start. Once the program begins to grow, the number of new members required to sustain the system cannot be achieved. Managing who gave how much money when also becomes increasingly difficult. As a result, the most recent members “gifted” money, but never receive any. There goes the life savings.

Do you see why Wikipedia simply refers to cash gifting as a pyramid scheme? There can’t possibly be any good that comes out of this other than learning a lesson the hard way.

I can be sympathetic to the people that get caught up in this program, as the people recruiting can be very good “marketers” (eh hem, scammers) and play on hope and emotion. Sadly, it seems like they prey on the desperate who risk everything they have for a chance to fix their lives.

If these cash gifters just put this amount of energy into building a real business, they wouldn’t have to worry about destroying people’s lives or worry about how long the gravy train will last.

That being said, this is my interpretation of cash gifting programs. If I’m completely off here or missing important details, please do correct me.

I think that it was Stephen King who said he liked studying serial killers and criminals not because he wanted to become one, but so he knew how to avoid them. If you ever get approached about this or any other money making system, remove yourself from the emotion involved in your decisions and think about what your gut and logic tells you.

7 Responses to What Are Cash Gifting Programs? Don’t Fall Victim to This Scam

  1. randi6 says:

    There is one cash gifting program that does not implement cash residuals. If you want to know more please contact me. It is difficult being the only one of it’s kind when all of the other programs are using pass-ups, 1-ups, splits etc.

  2. Hi, Randi6,

    Please tell me about the one cash gifting program that does not implement cash residuals. Please also explain the aspect of “implement cash residuals.” I assume that it may mean that one’s costs for websites and leads are extracted from your cash giftings?

    Thank you. //Michael

  3. Jessica M says:

    I am looking for a legitimate cash gifting program. I have fallen victim to the scams, but I’m not giving up yet. Because somebody is making money. :)

  4. Are Cash gifting programs legal? NO they are not! I say this because, to be legal, they are not to be promoted for the benefit of themselves and others. Gifting is defined in the IRS code, as gifting to others with no expectation of receiving anything in return and the IRS code is what every so called gifting program uses to justify their legality. But what they fail to mention is that when these cash gifting promoters start opening envelopes on your video screen and ask you to get two or more referrals, it becomes illegal without having a legitimate product base business structure behind them. They miss the point of the program being legitimate.

  5. Arnold H says:

    I don’t know about this article I’ve seen many people claim that these “legitimate businesses” it speaks of ruining their lives. :) Cash gifting allows the people who actually participate benefit form the activity.

    As far as legitimate gifting programs there are legitimate ones out there. The one I’m with is a very tight program been around for 10 years with no issues. As far as not having a residual the down side to that is 1. You don’t ever earn a residual income and 2) there is no incentive for your inviter to train the new person. I’m pretty motivated to train people when I know i’m going to make as much from helping them as I would to bring in another new person plus it keeps my line going.

  6. Alexander P says:

    Cash gifting when done right will help everyone if it evens only means they get educated. You don’t try to recruit, this isnt the Army. You simply educate someone on the fact that there will always be people willing to give money for whatever.

    You educate them that because of this one fact that will never ever stop, there is a chance that someone may also give to them. No selling , no hassels, nothing to hide from.

    Those that say it is a scam, was never educated on cash gifting. Your first goal is to get educated, then follow how you to can educate others,

  7. I have been balanced , leaner , including fitter on account of info like this . I just pray some people are in the position to discover the exact same incentive from browsing through very similar messages.

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