Collecting money to give to charity. Taxes?

[Guest]

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[Sherri]

I'm wondering if we have any accountant or tax attorney KivaFriends around here. I have a question bugging me, mainly as I was thinking about vote4cause and the Florence's school collection fund and things like this.

If I collect money from various people (who do not expect a tax receipt from me), and I then send all that money to a charity, how does that affect my income taxes?

For example, that vote4cause site could take in $12,000 per year. Does that mean that the site owner has to declare an extra $12,000 of income on his income tax return... and then show a $12,000 donation? Since you don't get a 100% write off for your donations, that person would end up in the hole.

Just wondering if the good folks like Jill who are collecting money to send elsewhere are going to have some kind of tax issue.

Anyone know? Is it considered income if you are collecting it on behalf of others to give away to charity?

[AccountAbility]

In general, these pass through giving situations would have no effect.  If what you get is what you pass along, then you are acting like an escrow agent.  Only if someone accused you of pocketing a chunk would the records be checked out. 

If a deduction is sought by the various givers, then it gets more complicated, but assuming there was a receipt from the charity for the whole amount, you could appropriately apportion that back out to each of the givers.

Dan
[This advise is of course worth exactly what you paid for it.]

[Diane R]

For everyone's information, I don't expect any receipt from anyone for the contribution we sent to Florence for the Mirembe School, so.... sorry if you were hoping to take it as a tax deduction.   

--Diane.

[Eli]

I had no such expectations.

Still grateful for everyone's efforts to make it happen,

Eli

[AccountAbility]

For everyone's information, I don't expect any receipt from anyone for the contribution we sent to Florence for the Mirembe School, so.... sorry if you were hoping to take it as a tax deduction.   

--Diane.

I would hope that in the Kiva Friends environment nobody would be expecting a tax deduction for contributions to these informal funds collected here.  Even the question of what constitutes a charity for tax purposes is murky at best when dealing internationally, and Friends themselves reside in many different tax jurisdictions. 

These are just donations from the heart. 

Dan

[cpbailey]

Dan,

Unless something is a 501(c)(3), then it isn't a tax deduction.  It is an expensive and time consuming endeaver to make a non-profit...

I do think you get to make a deposit on your karma account, though!

Colette

[davidannis]

I started a website to try to raise money for educational charities while having a little fun.  (So far it has done nothing).  http://www.ignoranceoffsets.com

I allow users to request that when I forward the money to charity they get a tax receipt.  It's their money, I just wrote the check.  I don't do it because I think that anyone cares about the $5 deduction; I do it because a donor deserves the transparency to know that their money got where it was supposed to go.

David