My son is a singer/songwriter and has been putting everything possible from his 250+ shows per year into his next album. It's entirely self-funded, paying for studio musicians and producers on his own. One of the musicians who performs with him made an unsolicited contribution to help expedite this album release. This gentleman isn't just a friendly musician, he's become a huge fan over the years and wanted to help him get this next album out as quickly as possible.
One day last year, my son got a text saying he'd received $1,000 bank transfer from this guy. Not that it matters but it was completely unsolicited and unexpected.
Does this need to be reported as income along with his other performances, or does it get reported somewhere else? Or does it get reported at all?
Also, using Turbo Tax Home And Business, where would he report unpaid gigs as a loss and performances he did at a discounted price or donated for free (i.e. charity events)? What would this look like in TTH&B? I'm new to this version of TT, so as much direction as possible would be greatly appreciated!
Money that you receive as a gift is not taxable income to you, and you do not need to report it on your income tax return. Money that you gave as a gift to someone else is not deductible for your taxes.
The unpaid "gigs" for charity are not deductible except for any expenses incurred like mileage to get there, supplies, etc. You cannot deduct anything for your time, skill, talent or expertise as a charity donation.
Thanks for your help. What about the unpaid gigs that were not considered charity? These were for prearranged amounts but were never paid despite repeatedly billing. If there's somewhere it can be written off on his Sch C, the loss may provide a larger benefit to him than if he pursued this in court, If it's allowed, where would it be entered? Would it be limited to 2018 unpaid amounts? He had a few of these from the last quarter of 2017 that he was allowing more time to get settled before giving up and considering it a loss. Some were even earlier than that, like in 2016, but they kept telling him they would take care of it and just never did. Trying to keep up with hundreds of gigs every year makes it hard to continue revisiting the same people about the same issue, and eventually its just time to move on.