Some money raised through crowdfunding may be considered a gift.

From IRS Tax Tip 2022-120, August 8, 2022

Under federal tax law, gross income includes all income from any source, unless it’s excluded from gross income by law. In most cases, gifts aren’t included in the gross income of the person receiving the gift. Here’s what people involved in crowdfunding should know:

• If a crowdfunding organizer is raising money on behalf of others, the money may not be included in the organizer’s gross income, as long as the organizer gives the money to the person for whom they organized the crowdfunding campaign.
• If people donate to a crowdfunding campaign out of generosity and without expecting anything in return, the donations are gifts. Therefore, they will not be included in the gross income of the person for whom the campaign was organized.
• However, not all contributions to crowdfunding campaigns are gifts and may be taxable.
• When employers give to crowdfunding campaigns for an employee, those contributions are generally included in the employee’s gross income.

People who run crowdfunding campaigns or receive money from one should keep careful records about the campaign and the disposition of funds for at least three years.