Entrepreneurs, artists, charities and others may now find it easier to raise money on the Internet through crowdfunding websites.
If the money starts rolling in, these individuals and organizations should be aware that it likely must be reported to the IRS as taxable income. (The expenses associated with the activities can be claimed as deductions.)
Many people raising money on the Internet view their endeavors as non-taxable hobbies. This could eventually result in an IRS audit.
If you are involved in crowdfunding, seek the guidance of your tax adviser to ensure your fundraising activities are properly reported on your tax return.
© Copyright 2014. Thompson Reuters. All rights reserved.
Brought to you by: Gordon Advisors, P.C.