Cash Gifting Watchdog

While some contend that SOW was started by a group of disgruntled former NOSS members. The programs are remarkably similar, with three gifting levels priced at $500, $1000, and $3500. But others report that SOW has existed for seven years (NOSS started in 2007, although it had at least three earlier versions). SOW has, depending on who’s telling the story, either 40,000 or 50,000 members in 16 or 20 countries.

Domain registration information for sowtoday.com says states that the domain has been registered since July 2007, or about 15 months from the time of this article. Not quite seven years - so we wonder if other aspects of SOW member success stories are similarly exaggerated.

SOW is another organization which claims IRS Title 26 in defense of its legality, and even link to that publication in their FAQ.

Anyone who follows up and actually reads Title 26 will discover this:

Gift Tax

The gift tax applies to transfers by gift of property. You make a gift if you give property (including money), or the use of or income from property, without expecting to something of at least equal value in return.

Try and square that with this bit of coercion from the SOW “How the Levels Work” Q&A:

Remember, you can only receive a gift when you are qualified to receive gifts on THAT level. Can you see how important it is to get qualified at all 3 levels as soon as possible?”

Scenario Summary - To fully enjoy all the system has to offer I have to accomplish two things at each level. Give my inviter the gift amount and and give up the very first person at that level to my inviter. And I can upgrade along the way, right?”

How can you simultaneously encourage someone to qualify to receive gifts “on all three levels” by gifting someone $3500, without leading them to expect that they will “receive something of at least equal value in return?“

Perhaps some fast talking and the SOW “Gifting Statement” could persuade the IRS of your intentions to give unconditionally:

I have been told not to expect any return of any nature, and I have received no license or privilege of soliciting or recruiting other parties. I will not at any time ask for this gift to be returned to me and with this statement, I waive any and all my rights to civil or criminal remedies against the recipient of my gift.

(Why would you have any “rights to civil or criminal remedies” for engaging in a completely legal activity?)

The problem with the gifting statement is that you CAN’T recruit others to join SOW until you’ve ponied up at least $500.

Then there’s the SOW “non-solicitation statement“:

“Any documents or information received by me will not be construed as solicitation in any way whatsoever. I further affirm that I have been told that the nature of these activities is that of charity…”

SOW, on this point, will be fighting the same uphill battle which faces NOSS. Unless it has qualified as a charitable organization under IRS regulation 501 (c) (3), it’s not a charity. And it can’t qualify under that regulation, because it’s been organized, and is being operated, for the benefit of private interests, those of its own members.