Is Cash Gifting Legal

The number one underlying question that comes to mind when people begin seeing the lucrative potential with Cash Gifting is, Is Cash Gifting Legal? When you research online, you're going to find that there is really nothing saying that Cash Gifting is illegal. You may find some people expressing their own opinions, not facts.

What you will find is that both American and Canadian citizens have the Constitutional right to gift property, cash and other assets. Many other countries participating in Cash Gifting also have very similar gifting laws.

In the United States the gifting rules are found in the Department of the Treasury Internal Revenue Service Publication 950 - Introduction to Estate and Gift Taxes, and, IRS Tax Code, Title 26, Sections 2501-2504 and 2511.

In 2008, in the United States of America, the law states that one or more individuals can give a cash 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, because the tax on the gift has already been paid. The annual exclusion for 2008 is $12,000.

So for example, in 2008, you gave your niece a cash gift of $7,500. It is your only gift to her in 2008. The gift is not a taxable gift because it is not more than the $12,000 annual exclusion.

To view a picture diagram of how this works, go to:

http://hubpages.com/hub/Cash-Gifting-to-Tax-Free-Wealth