Do I have to pay taxes on a sizable donation someone sent me?

April 7, 2024 12:24 PM

I'm an artist with an arts blog, and one of the readers generously sent a sizable donation this year. Do I have to pay taxes on that? Do they?

I'm an artist with a personal (not for profit) arts blog I've been running for years.

This year one of the readers generously sent a sizable donation.

I do have a 'donate' button up on the blog in a few places.

Do I have to pay taxes on that? Do they?

Also -- *could* I pay taxes on it, if I found doing so advantageous in some way?

posted by cotesdurhone to Work & Money (9 answers total)

Are you in the U.S.? And how sizeable do you mean, roughly?
posted by NotLost at 12:40 PM on April 7

Response by poster: To clarify... In the US. A few thousand bucks.
posted by cotesdurhone at 12:42 PM on April 7

When you say not for profit, do you mean you have a 501(c)(3) organization (assuming you're in the U.S.) - or do you mean you do it for fun and it's not monetized?
posted by Sweetie Darling at 12:43 PM on April 7

Response by poster: Ha, okay, to clarify further... I do it for fun and it's not monetized.
posted by cotesdurhone at 12:45 PM on April 7

Best answer: In general, in the USA and the UK (and probably a few other countries), gifts received are not typically subject to income taxes by the recipient. The Internal Revenue Service says a gift is “any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money's worth) is not received in return."
In other words, the gift-giver neither receives, nor expects to receive, some sort of value in exchange for the gift.

If the gift-giver receives something of value in exchange for the gift, and the thing of value is worth a similar amount of the gift itself, then it’s not really a gift. It’s a payment for goods or services, which will be subject to income tax.

Someone could argue the blog is providing value, but if you aren't directly linking that to payment, e.g. patreon posts that are only visible to people who donate, then I think you are clear.
posted by Lanark at 12:50 PM on April 7

Best answer: Gift tax - in general, the person giving the gift pays the tax and, usually, there is no tax because of the anual and lifetime exclusions.
posted by Mid at 12:51 PM on April 7 [1 favorite]

It's not clear where you (or your donor) are located. If both of you are in the US, the personal gift tax exemption per donee is $18k in 2024, where neither of you would have to report a gift of a few thousand bucks.
posted by I EAT TAPAS at 1:01 PM on April 7 [2 favorites]

You’re in the clear — as is the giver — unless the gift was over $18k (this year).
posted by PaulVario at 6:57 PM on April 7

Best answer: Above is correct, but for reference:
1) recipients of gifts, no matter how large, are not responsible for reporting gifts or paying gift taxes.
2) givers of gifts need to report gifts of more than $18,000, but they do not owe gift taxes on total gifts of less than $13 million.
posted by Mr.Know-it-some at 7:16 PM on April 7 [3 favorites]