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| *Ostroff, Fair and Company>>>Other Taxes |
Can I accept donations if I am for profit? |
I am for profit, and am starting a Ministry, I would like to go non-profit eventualy, but for now, won't. My question is: Can I accept donations, and what do I use to pay taxes on them? a regular 1099? And would be considered MY income? Or is there a company tax form? Thanks! If you are not set up as a 501c(3) non-profit, the donations people make to you will not be tax-deductible for them. This may discourage donations to your ministry. It would be unethical to solicit donations without revealing your status. It might be better to consider starting your ministry under the umbrella of an existing tax-exempt organization or going ahead with setting your organization up as a non-profit before you solicit donations. If someone who doesn't care about a tax deduction makes an outright gift to you to help you get started with your ministry, this would not be taxable income, because you don't have to pay taxes on a gift. If you are paid for performing a service, that is considered taxable income. For example, if you set up a business organization, tax-exempt or not, and that organization pays you a salary or stipend for your ministerial services, that would be taxable income and you would have to use some of that money to pay the taxes. The organization would issue a W-2 (if you are being paid as an employee) or a 1099 (if you are being paid as an independent contractor) and you would need to include this income on your tax return. I'd suggest you find a financial adviser who can help you set up your ministry properly so you don't run into trouble with the IRS later.ahh dude i could answer this for yo but i dont have tome....the best thing to do is consult an accountant. as the answer is area specific.... watch it though are on a fine line and a mistake here could cost you everything..... just get an accountant and set it up right the first time...good luck Justin, you can accept donations but they will be income, just hold out 25% for taxes. if this is your only source for income you will have to pay quarterly taxes. |
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