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I give a lot of money on GoFundMe every year to strangers (or online acquaintances/friends). I already exceed the standard deduction from other things, but it would also be nice to itemize these "donations" to reduce my taxes further.

They are all related to the same type of fundraiser - emergency vet bills for pets. For the people I don't know personally, I always check to make sure they have proof of vet bills/receipts with dates, and usually we have at least 1 mutual acquaintance whom I trust who can vouch for them.

Is there any legal way I could itemize these donations? Could a 501c3 distribute money to individuals in that way if it aligned with their mission?

Or could I setup some kind of foundation for example, be the sole contributor, and have the foundation give the money away? I was thinking of something similar to a foundation that gives scholarships, is there something similar to a scholarship I could setup?

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  • I don’t know enough about 501(c) nonprofits to answer but it sounds like the answer rests somewhere within the limitations on nonprofit activity...
    – newcoder
    May 28, 2020 at 5:10
  • Related but not a duplicate due to the other question referring to a single personally known individual rather than multiple recipients via crowdfunding platforms (which is an interesting angle) money.stackexchange.com/q/13385/45282
    – newcoder
    May 28, 2020 at 5:26
  • @newcoder I guess I didn't even consider that a 501c could cover this
    – 401k-newbie
    May 28, 2020 at 16:08

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You have two options when you donate money or items and want to be able to deduct them.

  • You donate to an actual charity. Before soliciting for donations they go the the required IRS approval process. They take your money or your items and perform all the IRS required activities to document what they receive, and how they spend their money or how they distribute the items they receive. When you donate money or items they will give you a receipt or other from of documentation for your records.

  • You setup a charity. You take the responsibility for getting approved as a charity, and you complete all the required documentation. If you then want to accept outside donations you have to complete even more documentation. There will be annual requirements to document what you do as a charity.

Those small donations though an individuals GoFundMe page probably do not count as a charitable donation from a tax perspective. Those individuals have not gone through the process of getting approved. That being said there can be real charities that use the platform to raise money.

Note: In short 501(c) is non-profit. 501(c)(3) is a charity.

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  • But if I setup a charity, and make tax deductible donations to that charity, can that charity give to the individuals on GoFundMe?
    – 401k-newbie
    Jun 1, 2020 at 16:53
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    You will have to define what your charity will do when you submit the paperwork. I have never done it, but I know it isn't trivial. I know in the past many boy scout troops wanted to establish them selves as charity. Only discover the requirements were too onerous to be worth the effort. There generally is also a state requirement that must be met.
    – mhoran_psprep
    Jun 1, 2020 at 17:12

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