Some fundraiser tax questions

[Trae]

I am putting together a fundraiser for an education fund for a neighbor and good friend who was a police officer. He was shot and killed at a local hospital during a scuffle with someone he brought in for DUI testing. The fund is for his adopted son and possibly a soon to be adopted daughter. Just making sure, but I do have to charge the customers tax, right? Also, since a portion of the sales is going toward the fund, is that tax deductible for the customer or for me? Kinda confusing since this is my first fundraiser with an education fund being the recipient. Thanks for any help!

Trae

[Georgia]

here's my understanding...If they are buying something of value and the procedes will be donated, they cannot use it as a tax deduction. Buying Girl Scout cookies is not tax deductable; making a cash donation to the Girl Scouts is.

You are not selling to a tax exempt organization, so you must charge sales tax.

If you give money to someone, it is a gift not a tax deduction. It must be a recognized charitable organization in order to qualify for a charitable deduction.

You are doing a good deed and only the people that SHOULD benefit from it will benefit from it.

[Trae]

Thanks! That makes it much more clear.

Trae

[agoodsaid]

Georgia's got it right, as I understand it too ...

If someone receives real goods for their participation, it is not tax deductible for them.

And unless the org. or group that you are running the fundraiser for has a non-profit status and tax exempt number (they will KNOW if they do ... AND you are selling directly to the group, sales tax gets collected.

But if for instance, you were doing a fundraiser and a tax exempt group were the recipient, but you were doing the direct selling then paying out a portion of your sales, I believe that you would still have to collect sales tax from the end consumer.

Hope that doen't muddy up the clarity ?!

Andrea