By Mark Gruba, CPA Matt Bryant discussed the multi-billion dollar trend of crowdfunding and its tax implications Monday on News 8 at Sunrise.
Bryant is the Controller at PharmaSmart International and the President-elect of the Rochester Chapter of the New York State Society of CPAs.
Bryant said crowdfunding, the process of raising money for creative projects or charity via the internet, raised $1.5 billion worldwide in 2013. It can bring large amounts of people together to raise money for a cause, whether that be a business, project, charity or medical need. Crowdfunding has been used to fund movies, CDs, video games and other projects.
It’s estimated that in 2012 over one million individual crowdfunding campaigns were started globally. There are over 400 crowdfunding websites including Kickstarter, FundRazr, IndieGoGo, GoFundMe and GiveForward.
Bryant said there are no restrictions in terms of how much money can be raised through crowdfunding. Some people or groups may promise an item at the end of the fundraising process, such as a book or CD.