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GoFundMe
What are the fees for using GoFundMe? HOW DOES GO FUND ME WORK? CAN YOU PLEASE EXPLAIN IN DETAIL STEP BY STEP ON HOW TO SET UP A GO FUND ME ACCOUNT? HOW MUCH DOES GO FUND ME TAKE ON A $100 DONATION? DOES GO FUND ME CHARGE FEES FOR NON-FOR PROFITS? DO YOU HAVE TO PAY TAXES ON MONEY DONATED THROUGH GO FUND ME?
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This discussion was modified 1 month, 3 weeks ago by
Gustan.
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This discussion was modified 1 month, 3 weeks ago by
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This is an extensive and, hence, complete explanation of GoFundMe and GoFundMe donations, which includes creating an account, getting the very first donors, fees, and tax consequences:
What is GoFundMe?
GoFundMe is a platform for fundraising by individuals, businesses, and non-profit organizations. It is mostly used during personal crises, medical needs, social projects, and entrepreneurial endeavors. Through this platform, one can launch a campaign, disseminate it online, and wait for people to fund it.
A Step-By-Step Guide On How To Open a GoFundMe Account
Step 1: Create an Account
Open GoFundMe.com and click on “Start a GoFundMe”.
You can use any of these means to sign up:
- Google account.
Enter your details, including your name, email, and password you created.
Step 2: Set Up Your Campaign
After creating your account, kindly click on “Start a Campaign.”
The following details must be entered by you:
Campaign Title: In this title, write a short phrase that gives the chief aim of the campaign.
Fundraising Goal: Specify the amount of money you intend to raise through the crowdfunding campaign, known as the target amount.
Location: Specify the thorough address for which these funds shall be utilized or where you reside.
Story/Description: Describe in detail your campaign why the funds are needed and how and why they will be used. Such reasons should be as subjective and emotional as possible.
Photos/Videos: You can upload good photos or a video to support your campaign’s activities and make it more informative and persuasive.
Step 3: Customize and Share Your Campaign
Customize your URL: You can create a URL for your campaign, which allows for easy sharing.
Share your campaign: Promote your fundraising campaign with GoFundMe’s integrated sharing tools through social media, email, or direct links. This will enable you to find possible supporters quickly.
Step 4: Set Up Withdrawal Options.
- You will have to create a bank account that can accommodate the funds that can be raised.
- Fill in the personal or organizational bank details.
- Complete the verification process ( Some processes involved may include ID verification).
- Select how often you would like to withdraw.
- Always Make this selection to withdraw every day, at least once a week, or every month.
Step 5: Thank Donors.
You can easily do this through GoFundMe by sending a thank-you note to those who have donated to your campaign. You can edit the text that you want to send to thank people.
What Is GoFundMe’s Cut for a Donor Who Has Tendered a $100.00 Amount?
GoFundMe ceased charging a platform fee to personal users in the United States. However, it does have transaction costs and fees – a payment processing of 2.9% + $0.30 per donation.
Split might be for a donation of $100, which would include the following:
Of this amount, 2.9% of $100 is payable = $2.90.
$0.30 for every transaction = $0.30.
Total fee charged: $3.20.
So, out of the 100, you will receive 96.80 after the fees are deducted.
GoFundMe For Non-profits. Do They Charge Fees?
GoFundMe also has a platform called GoFundMe Charity, specifically for non-profits. They also have a system where they charge the payment processing fee at the rate of 2.2% plus 0.30 per donation for donors from the US (less than the fees for the personal campaigns).
Non-profits do not incur platform costs because only the payment processing fee is applicable.
For instance, in case one made a $100 donation to a non-profit.
Of this amount, 2.2% comes to $100 payable = $2.20.
$0.30 for every monetary transaction made = $0.30.
Total cost for fundraising: 2.50 dollars.
Thus, the total donation made for the non-profit, which stood at one hundred dollars, will see the non-profit organization rotate with a figure of 97 dollars and fifty cents, and so forth.
Is any money received via crowdfunding websites such as GoFundMe taxable income?
For Personal Campaigns:
Donations are treated like gifts from one person to another. In most situations, the recipients do not pay tax on them.
However, the IRS requires reporting when funds raised for a personal campaign will be used for business purposes or if a substantive amount of money is raised that can be treated as taxable income. It would be beneficial to understand the proper reporting of the fund; hence, contact a tax expert. Funders do not receive tax benefits for funding individual GoFundMe campaigns, as these are fringe benefits, not donations.
For Non-Profit Campaigns:
Donations made to non-profit organizations with 501(c)(3) status listed on GoFundMe Charity will usually be tax deductible for the status holder once the non-profit body provides donation receipt documentation.
Charitable donations received by non-profit organizations will not be subject to tax as the organizations are not for profit.
- Key Guidelines for Running a GoFundMe Campaign Successfully
Craft a good introduction: State the campaign’s purpose and how the money will be utilized clearly and concisely.
Participate in social media: Give full and regular updates and respond to the supporters on social media.
Add picture and video attachments: Imagery increases credibility and catches the attention of a campaign.
Express appreciation: Those who provide assistance should always be acknowledged, and an explanation of the cause’s aim should be provided: it is normal to be fundraising.
GoFundMe is a versatile platform since fundraising projects are established for individuals and non-government organizations. Although it pays some processing fees, Payslite does not take any cut when using its platform. Most personal donations are not subject to tax. However, high risks or high amounts of money spent should be discussed with a tax advisor. Raising a new campaign takes a short time and is extremely helpful in achieving the fundraising campaign.
Do you need help with the creation process of your GoFundMe campaign or with some particular action?