Getting a business venture started or making a product via a crowdfunding project can be exciting. Seeing supporters, or backers, putting their money into your project can be uplifting. Just don’t forget about the IRS.
Many people who get funded often wonder whether the money received from crowdfunding is taxable. Despite the lack of specific guidance from the IRS, the answer is yes, crowdfunded monies are taxable income for the year that they are received, with limited exception. Fortunately, there are a few things that crowdfunding startups, individuals and businesses can do to maybe save a few bucks and avoid tax troubles.
