Are GoFundMe Donations Tax Deductible?
Are GoFundMe Donations Tax Deductible?
If you’re donating to help someone on GoFundMe, can you deduct it from your taxes? The answer is, it depends.
GoFundMe Donations That Are Not Tax Deductible
In general, donations you make on GoFundMe are personal, meaning that you’re donating directly to a person. In this case, donations that you make on GoFundMe are not tax deductible, they’re considered a gift.
Making these contributions can be part of your financial plan and lifestyle, but you can’t claim them on your taxes as a deduction because the recipient is not a qualified charity.
GoFundMe Donations That Are Tax Deductible
However, there are some charities that are registered as 501© organizations that do operate on GoFundMe. If you donate to a certified charity that is a 501© on GoFundMe, this donation is tax deductible.
Donations that are made to GoFundMe charities that are certified 501© organizations are classified as “GoFundMe Charity Fundraisers” and will provide you with a tax receipt. The tax receipt will be automatically provided via PayPal Giving Fund as the money is collected via this non-profit organization and then distributed to the charity.
GoFundMe also has tax-deductible giving available through GoFundMe Causes, where your donations go directly to specific causes that you choose and then to verified fundraisers and charities within those causes that are certified so that your donation is tax-deductible.
Charitable Deductions
When making any charitable contribution, for it to be tax deductible it must be to a qualified organization, as mentioned above. There are other stipulations that you should keep in mind regarding your charitable contributions and your taxes.
You can only claim charitable contributions as deductions if you itemize your taxes. In 2022, the standard deductions are:
Single: $12,950
Married Filing Jointly: $25,900
Head of Household: $19,400
The maximum amount you can claim as a charitable deduction when donating cash to a public charity is up to 60% of your adjusted gross income. You’ll need a record of your contribution to claim the deduction on your taxes, so ensure that you have a receipt that includes the date.
If you’re curious if a specific organization is tax-exempt, meaning that your donation would be tax-deductible, you can look up the organization using the IRS Tax Exempt Organization Search Tool.
It’s worth noting that, if you do donate to a GoFundMe that is tax deductible, but you receive any sort of gift for making the donation (a sticker, shirt, mug, etc.), your deduction amount will be reduced by the fair market value of that gift. For example, if you donate $100 to a charity and receive a sticker as a gift that is valued at $5, your tax-deductible amount would be $95.
As with anything tax related, if you have specific questions related to your situation or strategy, it’s best to ask a professional. A tax expert can help you strategize throughout the year and plan for the next year, including when to make charitable contributions if you’d like.
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