Any way - not taxable financial help for terminal son

Technical topics regarding tax preparation.
#1
jon  
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1535
Joined:
3-May-2014 11:11am
Location:
minnesota
An associate's son was just diagnosed with terminal cancer and proposed treatments are experimental and evidently not completely covered by insurance. A group of associates want to help with the medical bills. The first question is can a qualified charity take donations that will go for paying his bills. I said the charity has to be a 501(c)(3) for contributions to be deductible and then you have to some how make sure that they can pay the medical expenses directly to the vendors. The one time I tried to get that to happen they could accept the designated contributions, but as to the payment out depended on the board's approval and budget.

Can they have a Go Fund Me page - no charitable contribution and with no tax charge to associate or child. Not an expert, but Go Fund Me can be designated to pay medical bills directly, right? There would not be any income tax liability to the family as long as payments go directly to pay medical vendors charging the child, right? Who is in charge of the Go Fund Me money and who writes the checks?

They know they can raise $100,000- they want to make sure that bills get paid and no income tax becomes due for family members. The contribution deduction would be nice, but not necessary.
 

#2
EZTAX  
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1608
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24-Apr-2014 6:48pm
Location:
California
I believe these would be considered gifts and not taxable to the recipient. Does not matter if you use "go fund me" or other means.

Not sure there is any way to get the tax write-off because I do not think you can designate the beneficiaries of the charitable distributions. I am sure others will chime in here to help. Good luck.
 

#3
CrowCPA  
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402
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25-Apr-2014 3:27pm
Location:
New England
I agree with everything EZTAX has said. I am the treasurer of a local charity and had occasion to research this earlier this year. We collected finds on behalf of a family who lost their home to fire. In my acknowledgment letter to the donors I made it clear that these did not meet the criteria of charitable contributions for tax deductions. That is not exactly a big deal since so few taxpayers have itemized deductions at this point in time.

The payments do not have to go directly to the vendors - they can flow through the family.
 

#4
Joan TB  
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1897
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21-Apr-2014 9:08am
Location:
Texas
Here is an article in the Journal of Accountancy about GoFundMe. Might be helpful.

https://www.journalofaccountancy.com/issues/2018/mar/donation-based-crowdfunding.html
 


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