Whether You Owe Taxes on GoFundMe Depends on Why You Received It

The short answer: most personal GoFundMe campaigns are not taxable to you, but some are. The difference comes down to what the money is for. Money given to you as a personal gift—for medical bills, a house fire, or hardship—is generally not taxed as income. Money given to you in exchange for something, or money meant to cover business activity or self-employment, is taxable.

The IRS does not require GoFundMe to report personal gifts to them. But if your campaign raises money for something that looks like income—a service you provided, a business you're starting, or a side job—the IRS may treat it as taxable income whether or not GoFundMe reports it. The platform itself does not decide what is taxable; the nature of the transaction does.

Key Takeaways

  • Personal gifts for hardship, medical expenses, or emergency needs are generally not taxable income to you.
  • Money raised for services you provided, a business venture, or self-employment income is taxable and must be reported.
  • GoFundMe does not automatically report personal gift campaigns to the IRS, but business-related campaigns may trigger tax reporting.
  • If you are unsure whether your campaign is a gift or income, a tax professional can review your specific situation.

Personal Gifts Are Not Taxable Income

Under federal tax law, a gift is money or property given without expecting anything in return. If someone donates to your GoFundMe because you had a medical emergency, lost your home, or faced unexpected hardship, that money is a gift. Gifts are not taxable income to the person who receives them, and the giver cannot deduct them as a charitable donation on their own taxes.

This applies even if the campaign raises a large amount. There is no dollar limit on how much you can receive as a gift without owing taxes on it. The key is that the donor gave it freely, with no expectation of a service or product in return, and no legal obligation to repay it.

GoFundMe does not report personal gift campaigns to the IRS. The platform only issues a 1099-K tax form (which reports payment card transactions) when certain thresholds are met—and even then, a 1099-K does not automatically mean the money is taxable. You and your tax preparer use the facts of your situation to determine whether it is a gift or income.

Money for Services or Business Activity Is Taxable

If your GoFundMe campaign is raising money for something that is actually income, it must be reported as taxable income. This includes:

  • Campaigns where donors are funding a service you will provide (freelance work, consulting, tutoring, repairs).
  • Campaigns to start a business or fund a business venture where you will earn revenue.
  • Campaigns where donors are pre-paying for a product or service you will deliver.
  • Campaigns framed as investment in your work or creative project where you will profit.

In these cases, the money is not a gift—it is payment for work or a business opportunity. You must report it as self-employment income on your tax return, and you may owe self-employment tax as well as income tax. If the campaign raises over $600 and GoFundMe processes it as a payment (not a gift), the platform may issue a 1099-K, which will alert the IRS that you received the money.

How GoFundMe Categorizes Campaigns

GoFundMe allows you to choose a category when you start a campaign: Medical, Emergency, Memorial, Education, Nonprofit, Business, Creative, Community, Sports, Travel, or Other. The category you choose does not determine whether the money is taxable, but it can influence how the IRS views the campaign if it is audited.

A campaign in the Medical or Emergency category is more likely to be treated as a gift. A campaign in the Business or Creative category is more likely to be treated as income. However, the IRS looks at the actual facts of the transaction, not just the category label. If you create a campaign labeled "Emergency" but the description makes clear you are raising money to start a business, the IRS will treat it as business income.

GoFundMe itself does not make the tax information. The platform is a fundraising tool; it is your responsibility to report the money correctly on your taxes based on what it actually is.

When GoFundMe Issues a 1099-K

GoFundMe issues a 1099-K tax form when payment card transactions on your account exceed $20,000 and involve more than 200 transactions in a calendar year. This form reports the gross amount of money processed, not the net amount you received after fees.

A 1099-K does not mean the money is taxable income. It is straightforward a report of funds that moved through the payment system. If the money was a gift, it remains non-taxable even if you receive a 1099-K. You will need to explain to the IRS (if asked) why the reported amount is not all taxable income.

If you receive a 1099-K for a personal gift campaign, keep records of the campaign description, donor communications, and any documentation showing the money was given as a gift, not as payment for services or a business venture. This documentation protects you if the IRS questions the income reported on the form.

Reporting Non-Taxable Gifts on Your Tax Return

If you received a 1099-K but the money was a gift, you do not report it as income on your tax return. Instead, you may need to file a statement explaining the discrepancy between the 1099-K amount and your reported income.

This is where a tax professional becomes valuable. If your campaign raised $25,000 as a personal gift and you received a 1099-K for that amount, your tax preparer can file the return correctly and include a note explaining that the funds were gifts, not taxable income. Without this explanation, the IRS computer system may flag your return as underreporting income.

Keep the GoFundMe campaign page, any emails from donors, and bank statements showing the deposits. These documents prove the nature of the transaction if you need to defend your tax position.

State and Local Taxes

Federal income tax is the main concern, but some states and cities have their own rules. Most states follow federal tax law on gifts—they are not taxable. However, a few states have specific rules about large transfers of money, and some local jurisdictions may have questions about how funds are used.

If your GoFundMe campaign was for a specific purpose (medical bills, disaster recovery, education), use the money for that purpose. If you received funds for medical bills and then use them for something else, that does not change the tax treatment, but it may affect any other information you are receiving (such as need-based aid or benefits).

If you live in a state with income tax or a city with a local tax, mention the GoFundMe campaign to your tax preparer so they can confirm there are no state-specific reporting requirements.

Frequently Asked Questions

Do I have to report a small GoFundMe gift on my taxes?

No. Gifts are not taxable income regardless of the amount. You do not report them on your tax return. If you receive a 1099-K, your tax preparer can note that the funds were gifts and not taxable income.

What if I raised money for medical bills but did not use all of it?

The unused portion is still a gift and not taxable. You can use it for other purposes without owing taxes on it. However, if you received need-based financial aid or benefits, check whether having extra funds affects your may be able to access for those programs.

If I start a business with GoFundMe money, is that taxable?

Yes. If donors gave you money to start a business or fund a business venture, that is taxable income. You report it as self-employment income and may owe self-employment tax. The money itself is not taxable just because you use it to start a business, but the act of raising it for that purpose makes it income, not a gift.

Can I deduct GoFundMe donations on my taxes?

Only if your campaign is for a may have access to charitable organization or nonprofit. Personal GoFundMe campaigns are not tax-deductible for the donors. If you are raising money for a registered nonprofit, donors may be able to deduct their donations if the nonprofit is set up correctly.

Should I talk to a tax professional about my GoFundMe campaign?

If the campaign raised a significant amount, if you received a 1099-K, or if you are unsure whether the money is a gift or income, yes. A tax professional can review your campaign and help you report it correctly. The cost of a consultation is usually much less than the cost of an IRS audit.