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Donations that are passed through a private individual are never tax deductible to the person making the donation, even if the ultimate purpose is charitable. In most cases, donations paid directly to the school by the parents will be tax deductible charitable contributions (unless the school is a for-profit private school). Those gifts were used to pay the medical expenses of the taxpayer and are justifiably excludable from gross income as gifts." These amounts reflect the money taxpayer received as the result of gifts from donors. "All amounts in the 1099-K are excludable from income under IRC Section 102.

gross payments that exceed $20,000, andĪ potential manner to report this is to include the amount on the 1040 as “Other Income,” and reflect a negative adjustment in the same amount with a statement attached to your return (must file by mail then).

The settlement of third-party payment network transactions above the minimum reporting thresholds of IRS rules for those processing entities are very clear regarding the requirement to issue the 1099-K: Typically, money raised through a crowdfunding site such as Go Fund Me is processed through third-party settlement entities. The issue at hand is the 1099-K that the IRS requires be sent to recipient. If the funds are considered gifts then there are no tax implications for the recipient.

In order to be non-taxable funds generally have to come through a qualifying charitable organization or be considered gifts (which normally only the payor would have tax liability if excess gifting). The IRS has handed out big tax bills to people who have received large sums of money on go fund me in the last couple of years (many are still being fought as they can be considered gifts). This is an area of tax that's still developing.