I was the recipient of a GoFundMe campaign that was set up to cover unexpected medical bills last year. Am I responsible for paying the taxes on that since it was a gift?

[Kristieleigh2012]

The goal was set to $15,000 and the total raised was around $20,000.

[AmyC]

Crowdfunding can be taxable to the recipient depending on the circumstances. If people gave money to you and received absolutely nothing in return from anybody for giving, it sounds like a gift. However, you will receive a 1099-k for the income you received and the IRS will know about it. Most crowdfunding involves raising money for business or a service (or good) is received, those are all taxable income. Be prepared to prove that this was all charity, if it was. Otherwise, claim it as income.

[Kristieleigh2012]

Thank you so much for this information and quick response! Is there any specific way I can prove that it was a gift? I was diagnosed with borderline ovarian cancer and had to have a big surgery among other things so the donations came from friends and family to help cover those bills. Can I find the form that you mentioned while I am filing my taxes?

[Opus 17]

Gifts are not taxable income.  If you receive a 1099-K for the money, there are two ways to handle it.

1. Enter it as "other income."  The create a second item of "other income" with a negative dollar amount to offset the income, call it something like "offset for non-taxable gifts."  This will allow you to e-file, but the IRS may send you a letter asking for more information.

2. Leave the 1099-K off your return.  Print your return and file by mail.  Attach a copy of the 1099-K and a written explanation (but don't attach detailed proof).  This is the IRS recommended method, but because the IRS is so backlogged, I would probably choose method 1.

Keep proof that these were free will gifts (with nothing offered in return) for at least 3 years in case of audit.

And, since you paid these medical expenses with tax-free money, you can't list the expenses as a medical expense deduction. 

[Kristieleigh2012]

I have not received a 1099 for the gofundme campaign. 

[LeonardS]

The reply by @opus17 answers your question on the taxability of GoFundMe income.

@Kristieleigh2012

[Pwk218]

Would a transcript of the gofundme be sufficient in terms of proving that no goods or services were offered in return?

[Opus 17]

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@Pwk218 wrote:

Would a transcript of the gofundme be sufficient in terms of proving that no goods or services were offered in return?

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I don't know what you mean by transcript.  A copy of the original announcement/solicitation (describing who needs the money and why) would certainly be an important part of your evidence.  

[Pwk218]

If you don’t receive a 1099-k (nor does the IRS) what is the acceptable way of reporting, or do you just omit it from tax returns? 

[DoninGA]

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@Pwk218 wrote:

If you don’t receive a 1099-k (nor does the IRS) what is the acceptable way of reporting, or do you just omit it from tax returns? 

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Gifts received are not reported on a tax return, regardless of the amount received.