Boxes in the garage, a friend you don't want to lose. Stop autoship, claim the buyback, dispute charges, move on.
This in-depth guide covers everything you need to know about leave an mlm and get your money back. Based on verified income data and real-world case studies from our database of 138 side hustle tactics.
To leave an MLM, cancel your autoship first, then send written notice that you are terminating, and ask for a buyback of your unsold, resaleable stock before you announce anything to your team. Companies that belong to the US Direct Selling Association promise to buy back marketable inventory bought in the last 12 months at no less than 90% of what you paid, and several US states, the UK and Malaysia set their own buyback rules. Dispute card charges within 60 days of the statement where you have grounds, keep records for tax, and report misleading income claims to the FTC.
The boxes in the garage
Maybe it is the boxes. They sit in the garage or under the bed, and every time you walk past them you do the sum again. Maybe it is the notification that your monthly order shipped, the one you meant to cancel last month. Maybe it is the group chat, where your upline posts another "rank advancement" and asks who is ready to "go all in" this quarter.
You are tired. You have stopped telling your partner how much you have spent. And underneath all of it is the hardest part: the person who brought you in is a friend, or a cousin, or the mum from school who was kind to you when you were lonely. Leaving feels like admitting you were fooled, and like betraying someone you love at the same time.
Here is what the data says about that feeling. In the AARP Foundation's 2018 survey of 601 current and former participants, "over four in ten (44%) MLM participants worked at it for less than 1 year", only 15% were still active, and "65% of the MLM participants would not join the same MLM organization that they first became involved with" (AARP Study of Multilevel Marketing, 2018, pp. 4 and 12). In its 2016 complaint against Herbalife, the FTC alleged that "nearly 50% of the entire Herbalife U.S. Distributor base quits in any given year" (FTC complaint, para. 78). Leaving is what most people do. You are joining the majority, and you get to do it carefully.
This guide is part of our honest series on MLM and direct sales. Nothing here is legal or tax advice. Where your rights depend on a specific law, we name the law so you can check it or ask a professional.
Before you tell anyone: gather your paperwork
Do this quietly, in one evening. Once you announce you are leaving, some back offices and team chats may close to you.
- Your agreement and the company's policies and procedures. The buyback terms, cancellation steps and deadlines are in there. Save a PDF.
- Your full order history. Every order, with date, item and price paid. Screenshot it if you cannot export it.
- Your commission statements. You need these for tax and to see the real total.
- Bank and card statements for the whole time you were in. Highlight every payment connected to the business: orders, fees, events, training, travel.
Then put the numbers into the MLM profit calculator. Seeing the true monthly figure in black and white makes the next steps easier, because you stop arguing with yourself about whether it might turn around.
Step 1: Stop the autoship today
Every month you wait is another order. Cancel the recurring order in your back office, then confirm in writing by email so you have a dated record.
US law is on your side here. The Restore Online Shoppers' Confidence Act requires online sellers of recurring plans to "provide simple mechanisms for a consumer to stop recurring charges" (15 U.S.C. 8403). The FTC's consumer advice says: "Businesses must make canceling simple for you. It's the law." If charges keep coming after you cancel, it tells you to "file a dispute for chargeback" with your card company and report the business (FTC consumer advice, Sept 2024).
You may have read about a federal "click-to-cancel" rule. On July 8, 2025, the Eighth Circuit vacated it, and the FTC restarted the process with an advance notice in March 2026 (Federal Register, March 13, 2026). As of October 2026 no new federal rule is in force, so rely on ROSCA and your card company.
If your upline says you need to "stay active one more month" to keep a bonus or a team position, write down what that month would cost and compare it with the bonus in your last statement.
Step 2: Count what you are holding
Go through every box. For each product, write down:
- the product name and quantity
- the date you bought it and what you paid (from your order history)
- whether it is unopened and still resaleable
- the expiry or best-before date, if it has one
This list is the backbone of your buyback request. Buyback rules usually cover products in resaleable condition bought within a time limit, so the dates matter as much as the amounts. Products bought most recently are the ones most likely to qualify, so start the request soon.
Step 3: Ask for the buyback in writing
What the industry code promises (US)
The US Direct Selling Association's Code of Ethics requires member companies to repurchase "marketable inventory, promotional materials, sales aids, tools and kits within twelve (12) months from the salesperson's date of purchase at not less than 90 percent of the salesperson's original net cost less appropriate set offs and legal claims, if any" (DSA Code of Ethics, as amended through Dec 13, 2018). This applies when you end your business relationship with the company. Products past their shelf life, and products the company told you in advance were "seasonal, discontinued, or special promotion", can be excluded. The DSA says the purpose of the buyback is "to eliminate the potential harm of 'inventory loading'".
The Code only binds DSA members, and your company's own policies and procedures set out the process. Read both.
What some US states require
Several states write the 90% rule into law. Massachusetts requires that resaleable products be "repurchased ... at a price of not less than ninety per cent of the original net cost" when a participant cancels "for any reason at any time" (M.G.L. c.93 s.69). Wyoming's statute says "the repurchase shall be at a price of not less than ninety percent (90%) of the original net cost" (W.S. 40-3-104). Georgia's multilevel distribution law also sets a 90% repurchase price and requires the contract to say a participant "has a right to cancel at any time, regardless of reason" (Georgia Consumer Protection Division). That published copy is dated 2006, so check the current code. Louisiana defines "reasonable commercial terms" in its pyramid law as repurchase of products bought "within the previous twelve months ... for not less than ninety percent of the actual amount paid" (La. R.S. 51:361).
Your state attorney general's consumer protection office can tell you whether your state has a similar rule.
UK
The Trading Schemes Regulations 1997 give you the right to cancel within 14 days of signing "without penalty and with the right to recover any monies" paid, and to terminate "at any time without penalty by giving 14 days written notice" (SI 1997/30, regs 5(e) and 5(f)). When you terminate, you can return goods bought in the 90 days before termination and recover the VAT-inclusive price you paid, less any loss in value you caused and "a reasonable handling charge" (reg 6).
The Direct Selling Association UK's Code of Business Conduct, effective June 2025, goes further for members. It buys back stock bought between 90 days and one year before termination, less commissions paid on it and a handling charge of up to 10%, if you return it within 14 days of terminating. It also makes joining or renewal fees paid in the 30 days before termination "fully refundable" (DSA UK Code of Business Conduct, rules 10.2 and 10.5).
Malaysia
The Malaysian Investment Development Authority (MIDA), describing the Direct Sales (Scheme and Conduct) Regulations 2001, says a participant gets "not less than 10 working days from the date of the recruitment to cancel his membership", and that a direct sales company must "buy back any marketable goods sold to the participant within the period of 6 months after goods purchase date, at the price not less than 90 per cent of the amount paid" (MIDA booklet, 2021). That is the government agency's summary of the Regulations. If a company refuses, the licensing body is KPDN, which keeps the list of licensed direct selling companies.
Why you should push, politely and in writing
The FTC has seen buybacks fail in practice. Its staff guidance warns that "participants may be unaware of their right to a refund; the refund process may be too complicated ... or obtaining a refund may require quitting the opportunity entirely" (FTC staff, Business Guidance Concerning Multi-Level Marketing, rev. April 2024, Q10). In the LuLaRoe case, Washington's Attorney General said "many retailers did not receive the promised 90 percent, and some received no refund at all" (Washington AG, Feb 2, 2021). A dated, written request with an itemised list is much harder to lose.
A buyback request you can adapt
Send it to the company's customer service or compliance address, not to your upline. Keep a copy.
Subject: Termination and inventory buyback request, distributor ID [number] Hello, I am ending my independent distributor agreement, effective today, [date]. Please close my account and cancel any recurring orders. My autoship was cancelled on [date]. Under your policies and procedures [and the DSA Code of Ethics / the law of my state or country, if it applies], I am requesting a buyback of the unopened, resaleable products listed in the attached spreadsheet. The list shows each item, the order number, the purchase date and the price I paid. Please send me the return instructions, a return authorisation number if you use one, and the refund amount you will pay for each item. Please also confirm in writing the date my account was closed. I would appreciate a reply within 14 days. Thank you, [Name, address, phone, distributor ID]
Pack the returns carefully, pay for tracked shipping and photograph the boxes before they leave. If the company stops replying, the complaint routes in Step 6 are where to go next.
Step 4: Dispute card charges you have grounds for
If you were charged after cancelling, charged for something you did not order, or never received what you paid for, you can dispute it with your card company. The CFPB says "you must also send a written billing error notice to the card company within 60 calendar days after the charge appeared on your statement" (CFPB, reviewed April 15, 2024). The FTC adds that the issuer must resolve the dispute within 90 days. For disputes about the quality of something you bought, the purchase "must have cost more than $5", and you must have tried to resolve it with the seller first (FTC consumer advice, May 2022).
A chargeback is for genuine billing errors and unresolved problems. Product you ordered on purpose and then could not sell usually belongs in the buyback request.
The 3-day cooling-off rule, and when it does not help
The FTC's Cooling-Off Rule lets you cancel some sales until midnight of the third business day. It covers sales made at your home for $25 or more, and sales of $130 or more at temporary locations such as hotel rooms, convention centres and fairgrounds. It does not cover sales "conducted and consummated entirely by mail or telephone" (16 CFR Part 429, eCFR). If you signed up and bought a starter kit at a hotel opportunity meeting in the last three business days, read it today. Most online back office orders fall outside it.
Step 5: Decide what to do with what is left
Some stock will not qualify for buyback: opened items, things past the time limit, things the company excludes. Sort it into three piles:
- Use it. Products you would genuinely use replace things you would otherwise buy. That is real value.
- Sell it. Read your agreement first for any limits on where you can resell, then price it to move. Reselling is a skill in itself, and our guide to live selling covers the platforms.
- Give it away. Food banks, shelters and friends. The money is gone either way, and clearing the space has its own value.
Question to sit with: if you are still holding product because selling it at a loss feels like making the loss "real", is the box in the garage worth the weight you carry every time you see it?
Step 6: Taxes
If you received commissions or bonuses, that is income, and you may have tax to report even in a year you lost money overall. Whether you can deduct your costs depends on whether the IRS would see your activity as a business or a hobby. The IRS says "taxpayers should consider nine factors" (IRS Tax Tip 2019-85), including whether you ran it in a businesslike way, kept books, depended on the income and changed methods when it was not profitable, and "no one factor is more important than another" (IRS Tax Tip 2022-57).
If it was a hobby, the rules are harsh. The IRS says that if taxpayers "aren't trying to make a profit ... they can't use a loss from the activity to offset other income" (IRS FS-2022-38), and that "losses from a hobby aren't deductible from other income" (IRS Publication 525). The 2025 tax law made the disallowance of these miscellaneous itemised deductions permanent for tax years after 2017 (26 U.S.C. 67(h)).
Bring your commission statements, order history and expense list to a tax preparer. Our side hustle tax guide covers the basics of reporting side income. This is general information, not tax advice.
Step 7: Report it if you were misled
If someone told you that you would replace your salary, showed you cars and houses, or never mentioned the costs, report it at ReportFraud.ftc.gov and to your state attorney general, the two places the FTC sends consumers (FTC consumer advice). A report will not get you a personal refund by itself, but enforcement cases are built from them, and some return money. After the Herbalife settlement, the FTC mailed checks to "nearly 350,000 people", most between $100 and $500 (FTC, Jan 10, 2017). The AdvoCare settlement returned "more than $149 million" to "more than 224,000 consumers" (FTC, May 5, 2022).
If you are unsure whether what you experienced crossed a legal line, MLM red flags and MLM vs pyramid scheme set out what regulators look for.
The friend who brought you in
This is often the part people dread most, and it is common. In the AARP survey, 34% of participants were recruited by a friend, and the most common reason for leaving was "awkward pitching to friends and relatives (39%)" (AARP, 2018, pp. 6-7 and 11).
Your friend probably believed it, and may still be losing money too. Leave without trying to win the argument. Something like:
"I've decided the business isn't right for me, and I've closed my account. I'm grateful you thought of me, and I want to keep being friends. I'd just rather we didn't talk about the business."
Expect pushback: "you're quitting right before it takes off", "winners never quit". You do not owe anyone a debate. If you want to share what you learned later, share the numbers, gently, when they ask.
Question to sit with: when you picture yourself six months from now, with no monthly order and no team chat, what does that version of you feel?
The money you spent is gone, and spending more trying to win it back is how losses grow. Start from today's numbers.
If you need cash quickly, how to make $1,000 fast ranks the honest options by speed. When you are ready to build an income again, take what the MLM taught you (talking to customers, posting consistently, following up) and use it somewhere you keep the margin. Our guide to MLM alternatives with better odds compares side incomes with no inventory to buy and no recruiting to do, such as online tutoring and pet sitting.