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Personal Tax4 min readMar 17, 2026
The Tax Side of Crowdfunding Income
Crowdfunding for business, charity, or personal needs each has different tax treatment. Here's what you need to report and what you can keep.
Tax Treatment of Crowdfunding Income
Crowdfunding Categories
Business Crowdfunding (Kickstarter, Indiegogo)
- Money raised for a product or business venture
- Generally taxable income if in exchange for goods, services, or rewards
- Deductible business expenses offset the income
- If you never deliver the promised rewards, you still owe tax on the money received
Charitable/Personal Crowdfunding (GoFundMe)
- If donors give purely out of generosity with nothing in return: may be treated as gifts (not taxable)
- But the IRS scrutinizes these situations
- If organized and systematic, may look like business income
Equity Crowdfunding (Regulation CF)
- Investors receive equity stake in exchange for funds
- Not immediate income to the company
- Future: Investors pay capital gains when they sell
Form 1099-K from Platforms
- Platforms may send Form 1099-K if payments exceed $2,500 (2025)
- Receiving a 1099-K doesn't automatically mean it's all taxable
- Keep records of what was gifts vs. payments for goods/services
Platform Fees
If your crowdfunding income is taxable as business income, platform fees are deductible expenses.
Raised money through crowdfunding? The tax treatment depends on the nature of the campaign — we can help you sort it out.