AboutJohn Stancil, CPA Expertise I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I teach tax and accounting at a small church-related college. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a part time tax practice for over 30 years. I am a member of the AICPA, National Association of Tax Professionals, and the Institute of Management Accountants.
Visit my website at www.johnstancilcpa.com.
Also visit my blog, www.thetaxdocspot.com.
Experience I hold a doctorate in Accounting, and four professional certifications: CPA, CMA, CFM, and CIA. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I write a monthly tax column for the local newspaper. I have prepared taxes for over 30 years.
Education/Credentials DBA University of Memphis
MBA University of Georgia
BS in Accounting Mars Hill College
Question My sister and I are organizing a benefit for our mother who has leukemia. She had to take an early retirement, has approx.
$600/mo income and limited health insurance. She also could be losing some of her coverage and widow benefits from GM at the end of the year. My question is what are the tax liabilities for monies raised, and how are the monies allowed to be spent? Just medical bills? or are you allowed to use for other bills, (utilities, car, etc)
www.trudyfish.com
Answer Larry,
Thanks for your question.
Since you are not a qualified tax exempt charity, the donors get no deduction for their contribution and you do not report contributions as income.
However, if the "benefit" involves you giving something to the donors (a concert, merchandise, etc) you may have to report that as taxable income.
There are no tax restrictions on how you spend the money, but state and local laws along with you own ethics may limit you from spending the money in a manner inconsistent with what you stated when the funds were received.
I'm not an attorney, so I can't give you advice on non-tax legal issues, but you need to be certain what you are doing is not in violation of state and local law even with proper disclosures.
