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simp1968 · Jul 30, 2011, 11:26 AM

If I were to hold a fundraiser event, what are legal expenses I can reimburse myself? Can I reimburse myself for my Cell phone usage? Can I reimburse myself for gas used to pick items up for the fundraiser? What about fliers? Ink for my computer? Also the paper I used? Items like that.

joypulv · Jul 30, 2011, 12:22 PM

A 'fundraiser' is supposed to be under the aegis of a registered not for profit. Now obviously soccer moms and such have a bake sale, and no one cares. So you work this out with the group you are raising money for, in advance. Generally yes, you keep receipts for direct expenses and deduct them from what you turn over to the non profit. When you are splitting personal use with this, phone and gas, for example, it gets a little tricky, and you might expect to work out a general lump sum. No one wants to go through your phone and mileage log.
You aren't declaring the income on your taxes, so you aren't deducting them either. The bigger and more involved it is, the more paperwork you will need to have with the nonprofit.

JudyKayTee · Jul 30, 2011, 12:23 PM

Are you asking about getting not-for-profit status from IRS? Something else?

I'd be VERY careful about gas/cell phones/think along those lines. If anybody decides that your expenses are too high and reports you to anyone (including your State's Attorney General) you could have very big problems, not the least of which is fraud.

If this is a self-proclaimed "fund raiser" I would make certain that people know that.

There was a recent fund raiser in my area for a patient undergoing a kidney transplant. The parents charged THEIR hotel rooms (and they went fairly high end) to the fund raiser proceeds... and were indicted for fraud. I understand their argument (which is they could pay X for the hotel room and the proceeds would go for daughter's medication OR they could pay for medication and let the fund raiser take care of the hotel room) but I don't think it's going to "fly."

Be careful. What is the purpose of the fund raiser?

C1 · Jul 30, 2011, 12:53 PM

Last I heard gas was only eleven cents on the mile. But, you might want to look into it further.

joypulv · Jul 30, 2011, 01:05 PM

IF you want to deduct expenses on your own taxes rather than arranging with the non profit to take costs out of funds raised, then do so. How feasible that is depends on your need for deductions. Mileage in 2010 was 14 cents a mile (not the regular 50 cents).

Fr_Chuck · Jul 30, 2011, 02:43 PM

Do you pay your cell phone by the minute or do you have a unlimited plan ?

But normally on small projects those doing the fund raising donate their time, and minor costs, and do not expect to get paid back.

Some payment for long term projects, for example I do pick ups for a charity a few times a week, it takes me about 2 to 3 hours per pick up, and I use my truck and my gas. And drive from 40 to 100 miles to do those pick up ( both ways)

They pay me 35 dollars per pick up. I normally consider this a loss since just my gas can be 10 to 15 dollars a pick up

But this charity is not operated by me and they are a federal approed charity ( IRS approved)

simp1968 · Jul 31, 2011, 08:08 AM

I only have 1500 talk minutes on plan but went way over doing this fundraiser. Before I go and hand evrything over, I need to know if this is possible to reimburse myself. My phone bill was $500 more than usual. My daughters bill was also $350 over her normal bill. Yes I did put the fundraiser together but I also didn't expect it to be so costly for me. I'm not so worried about milage as I am the phone bill. I don't have a home phone, so my cell phone is my only way of contacting people. But I guess the best way is just to contact a lawyer and figure it out because I don't need to be charged with stealing.

I'm sure a lot of this can be written off on my taxes but I could also talk to the people whom we raised the funds for and see how they feel. I don't want to take money that isn't mine!

Fr_Chuck · Jul 31, 2011, 08:20 AM

If your expense is over 3 to 10 percent of the total amount raised, it will be seriously looked at.

I would say it is a lesson learned that doing fund raising has to be taken seriously.

JudyKayTee · Jul 31, 2011, 08:26 AM

And what is the tax status of the fund raiser? You are aware that people cannot claim the money donated for tax purposes unless it is a recognized not-for-profit association AND they receive no "benefit" for their donation - ?

excon · Jul 31, 2011, 08:30 AM

Hello simp:

I don't know WHAT you're asking, and YOU don't either... Way up top, you said something about "legal" expenses... However, in order to ascertain what legal expenses ARE, we'd have to know what your agreement is with the charity... That's because IF they approved your deductions, then the word "legal" doesn't apply. If they DON'T approve of your deductions, and you TOOK them anyway, then "legal" DOES apply...

But, your agreement with the charity is key.. That would be because there's NO list of deductions that are LEGAL or NOT. For example, the charity COULD authorize you to deduct eye shadow if they wanted to, and if you DID, you did nothing illegal.. And, they might tell you that your cell phone bills are your own... That's up to them.

By the way... NONE of this has ANYTHING to do with YOUR taxes, or tax LAW.

Having said the above, it's apparent that you had NO agreement with the charity, or it wasn't compete, and you're asking us what would be a proper/legal expense. But, the place to negotiate your deductions is WITH the charity - not us. That's because they might think it's cool to let you deduct eye shadow...

Ok, I'm kidding about the eye shadow... But, since, as I explained, there's no legal issue, you just need to know what they'll agree to. You don't need a lawyer. You just need to negotiate what your role is with this charity, and what your compensation will be... Yes, you SHOULD have done it BEFORE you started, but you can CERTAINLY do it now.

excon

PS> (edited) By the way, you don't need to worry about THEIR tax status, or how THEY will report your employment... That's THEIR business. Your concern is your agreement with them.. That's it.

excon · Jul 31, 2011, 09:26 AM

Originally Posted by simp1968

If I were to hold a fundraiser event, what are legal expenses I can reimburse myself?

Hello again,

Sorry. I should have explained better. In order for you to understand my advice, from a legal standpoint, your first sentence needs to be DECONSTRUCTED.

First off, YOU will not be holding a fundraiser. YOU are not licensed, nor do YOU have the tax exemption. The CHARITY is holding the fundraising event, and YOU are CONTRACTING your services to them. THEY have the tax exemption.

As a contract employee, your CONTRACT is at the heart of your issue. Hence, my advice to negotiate your contract, even if it is late.

excon

JudyKayTee · Jul 31, 2011, 09:50 AM

My concern - and advice - is with the wording: "I were to hold a fundraiser event." I see no indication that OP is working for or on behalf of a charitable (or other) organization. I see OP as the organizer, not the employee.

Need more info. If OP is, in fact, running the show OP certainly does have legal issues to face. If OP is a volunteer or employee it's a different story.

Again, the word "I" makes me wonder.

Fr_Chuck · Jul 31, 2011, 10:01 AM

Assuming you are just doing this on your own, the problem first is if you are not honest and tell people this is not a charity and that it is not tax deductable, and they are lead to believe it is, it is fraud and you stand to be liable for other costs.
Also if you are not a approved charity any money you raise will be considered income and you will also have to pay taxes on that money.

What is the money being raised for ?
Are there other people doing this with you.
Is there a real charity behind this ?

excon · Jul 31, 2011, 10:02 AM

Originally Posted by JudyKayTee

My concern - and advice - is with the wording: "I were to hold a fundraiser event." I see no indication that OP is working for or on behalf of a charitable (or other) organization. I see OP as the organizer, not the employee.

Hello Judy:

I realize that's what SHE thinks her position is, and that's why she described it as such... However, even if it WAS her understanding, and I DOUBT it was, SHE ISN'T tax exempt. HER organization ISN'T tax exempt. Without BEING a charity, she CANNOT legally hold a fundraising event. If that's the position she takes, she might risk going to jail.

excon

Fr_Chuck · Jul 31, 2011, 10:04 AM

You can hold a fund raiser, just not a tax exempt one

excon · Jul 31, 2011, 10:11 AM

Originally Posted by Fr_Chuck

You can hold a fund raiser, just not a tax exempt one

Hello again, Padre:

Well, that IS true, of course.. But, with a REAL charity behind this, why WOULDN'T they be the sponsors, so the donations can be DEDUCTED from the donors taxes? That IS what attracts people to charitable events, no?

Frankly, I think she just doesn't understand the relationships between the parties. Once she does, the event can proceed as planned, and EVERYBODY will be happy.

excon