Quote:
Originally Posted by Ro13
#1;I want to provide a service for free. Some people will probably make donations for my service, but have no obligation to do so. Are the donations I receive taxable?
#2;Under what conditions? |
#1;no it is a gift;a done not subject to the gift tax. When one person gives a gift to another, the person who gives the gift, known as the donor, usually must pay the gift tax. The person giving away a significant amount of assets is likely to have greater ability to pay the tax. If a gift were to impose a large tax on the recipient it would diminish the value of the gift.
#2;no unless it is for your service, then it is taxable to you as compensation.
note;under the net gift situation , a donee may pay tax; However, the IRS says that, "under special arrangements the donee may agree to pay the tax instead. There are some circumstances under which neither party might have to pay the tax. As of 2014, if the cash value of all gifts given to a single person does not exceed $14k for 2014 within a year, neither party owes a gift tax.