[paramom]

My husband and I are having different fundraisers to raise the money to adopt from Guatemala. We have had three yard sales in the last month and we are having a yard sale/bake sale this weekend. We also have set out baby bottles in different locations to collect change. We talked to an accountant who said that the baby bottle money might be taxable as income since we are asking for donations. I called the IRS and they said that they had never heard of anyone having to pay taxes on yard sales and bake sales or other fund raisers but I forgot to ask them about the baby bottles. Thanks for any information

[tobeafamily]

Technically, yes, because it's a fundraiser - you're soliciting funds. Unless you're a 501 (c)(3) tax-exempt organization.

The activity of putting out baby bottles and asking for donations is different from the activity of selling merchandise or food. In the case of your yard and bake sales, in most areas these sales are subject to sales tax, though many communities exempt them or just don't bother to enforce this because the return - amount they'd collect in taxes - isn't worth the cost to collect.

So yes, technically you do owe unless you're a 501(c)(3) tax-exempt nonprofit.

The amounts involved though are low, meaning it's not likely that the IRS will attempt to collect.

Does this help?

Regina

[paramom]

Yes that is helpful information. I am wondering if we should just stick to yard sales and bake sales so that we do not have to fool with filing taxes on the income. We were going to do a candle fundraiser as well starting next week. Do you think it is worth it to do these type of fundraisers or should we just look for a loan to pay for the adoption?

We live in a small community and the people here are really not all for having fundraisers to adopt a baby. So right now I am not sure about what we should do.

[tobeafamily]

Here's what we did:

1. We did have yard sales, telling everyone who came that we were raising funds for an adoption. We did get many 'keep the change' and a few outright donations.

2. We sold stuff on eBay and put in our listing that we were raising funds for an adoption.

3. We asked friends & family to give us gifts to our 'baby fund' in lieu of presents at Christmas and birthdays.

4. We did cut some things out of our budget - SCUBA trips, eating at less expensive restaurants, no lunches out. Not everything, just some things.

5. We have had friends (we didn't do this) who did well having home shows for things like Homemade Gourmet, Pampered Chef, Mary Kay, Creative Memories, etc. - the distributor agreed to give them their 'hostess gift' as a cash donation rather than in product or % off deals.

The key to good fundraising through sales is a) deliver a good product and b) deliver a 'feel good' response. People resent buying 'junk' or overpriced product just to raise money - hence the reason why so many dread, avoid or refuse school fundraisers.

Now bake sales - mmmmm - people get a yummy baked good, reasonably priced, and a feeling that they're helping. Yard sales - they're looking for a bargain mostly, however if they can say 'keep the change' and feel good, they will.

BTW I also had a friend raise funds by selling instant bingo cards at a bingo hall. Not sure what the rules are in your state. I think what she did was have her agency agree to be the nonprofit named for proceeds, then she & her family staffed it and sold them. She made a good bit of money that way. I've also heard of people selling those magnetic car 'support our troops' type ribbons as fundraisers - again, feel good, decent value.

HTH

Regina