Discussion:Tax on blood donation
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Discussion Forum Index --> Tax Questions --> Tax on blood donation
| 28 October 2007 | |
| I gained 875 dollars for donating blood and received a 1099 MISC. do i have to pay taxes on that. what are they? and what sourse can i use? | |
Bottom Line (talk|edits) said: | 28 October 2007 |
| You didn't "donate" your blood, you sold it. Yes you have to pay tax. The rate depends upon your overall tax situation. Look at the instructions for form 1040 | |
| 28 October 2007 | |
| Mabaumann, did you sell this blood to the beggar who made $1,500 from begging? | |
| 28 October 2007 | |
| Where do you go these days to sell blood? I have donated over 17 gallons and all I have to show for it is orange juice an cookies. | |
| 28 October 2007 | |
| My Redskins are getting drubbed by the Patriots right now. I have nothing else to do.
You "gained" $875 for "donating" blood? As Bottom Line says, you sold it. And, fyi, you have "zero" for inventory, basis, cost, whatever. So you get taxed on the full $875. Mscash, I have the same deal as you. All this blood donated and only cookies and orange juice to show for it. Now, question for Mabaumann, do Mscash and I have to claim the cookies and orange juice as income or is it a reduction of charitable contributions? In either case, how do we claim it? :-) | |
Bottom Line (talk|edits) said: | 28 October 2007 |
| We used to sell blood all the time when I was in school. We'd load up as many people as could fit in a car and drive to Nashville. We'd pool the money and fill up the car with gas. Then we took the rest of the money and bought beer. Made for a cheap drunk. (Of course this was before AIDS, so the world may have changed.) | |
| 29 October 2007 | |
| don't forget the Domestic Production of Blood Activities Deduction under 199 | |
| 29 October 2007 | |
| Not only that, but if you do it "regularly and continuously" it could be subject to SE tax. If sold to end user, is it subject to sales tax, assuming it is not sold on Ebay out of state??? | |
| 29 October 2007 | |
| but then an allowance for depletion is appropriate, unless the person receives cookies and orange juice, in which case a 1031 exchange has been attempted | |
| 29 October 2007 | |
| blue blood is not like kind property to red blood, as every red-blooded american man knows | |
| 29 October 2007 | |
| I do hope that all of this research isn't going to waste and that these answers will appear in the homework assignment when it is turned in. I'd hate to waste my time and everyone elses asking these questions if I didn't intend on using the answers given and instead decided to think on my own. Nah, that won't happen. | |
| 29 October 2007 | |
| Hold on, he is producing tangible property for sale to customers. The uniform capitalization rules will have to come into play here or no self-respecting professor will be satisfied. He's got to follow this WIP right through his system, there will be some waste, but the same thing happens with lumber. | |
| 29 October 2007 | |
| Will the LIFO rules still apply?
Also - will nexus rules apply for the application of sales tax? | |
| 29 October 2007 | |
| Wait a minute, isn't there an allocation to be made between business and personal use as well in this case? | |
| 29 October 2007 | |
| Just think - if this case involved $ 276 less - there would be no reporting issue as a 1099-MISC wouldn't have had to be issued. | |
Bottom Line (talk|edits) said: | 29 October 2007 |
| And we all "know" that if you don't get a 1099-Misc, you don't have to report the income. | |
Bottom Line (talk|edits) said: | 29 October 2007 |
| 999999 - Other business not otherwise classified. | |
| 29 October 2007 | |
| Odd, blood is what Revenue Officers often want to pay a tax due. | |
Death&Taxes (talk|edits) said: | 29 October 2007 |
| I think I know who buys it. I've seen the 1099s often. It's Vlad's Transylvania Blood Bank LLC. It used to be a sole proprietorship but its owner started reading this Board and changed its entity. Vlad was going to fill in Form 8832 and make an election but JR drove a stake into him. By the way, it is only open after the sun goes down.
"Pardon me boy, is this the Transylvania Station?" | |
| 29 October 2007 | |
| I take it from Kevinh5's post that red blood might not be eligible for a 1031 exchange with blue blood.
And for Irsfixer, the blood revenue officers wanted came from turnips. It was green. | |
Donniecastleman (talk|edits) said: | 30 October 2007 |
| Oh yeah, it is almost Halloween, what if you donate blood for a sacrifice for the scientologists or satan worshipers? Could you take the FMV of the blood, $87, as a charitable contribution? heh heh just blabbing! | |
| 30 October 2007 | |
| See U.S. v. Garber, 607 F.2d 92 (5th Cir. 1979) for a tax case that dealt with selling blood. There are some theories that a person can have a tax basis in blood (cost of food). The Garber case was in the criminal context and the Fifth Circuit reversed a conviction for tax evasion stating that "[a] criminal proceeding . . . is an inappropriate vehicle for pioneering interpretations of tax law." | |
Sbamkmfdmdfmk (talk|edits) said: | 30 October 2007 |
| I'm assuming you're selling plasma, not blood! | |
| 25 November 2008 | |
| Gross proceeds received for blood donation qualifies as income under IRC ยง 61. If you paid a donor more than $600, you need to submit a 1099-MISC with the gross amount paid in Box 3 for "Other Income."
Taxability on blood donation has been brought before the courts at least twice; both times by the blood donors themselves. In both cases, the donors received 1099-MISC from the purchasing parties. In one case, an individual was charged with tax evasion because they did not claim the income, and in the other case, an individual erroneously deducted the amount on the 1099 from gross income. Links to cases: http://cases.justia.com/us-court-of-appeals/F2/607/92/118829/ (See P15) http://bulk.resource.org/courts.gov/c/F2/787/787.F2d.1538.85-7519.html (See P6) OROD 112408 | |
CarlLaFong (talk|edits) said: | 25 November 2008 |
| Sure, but the Tax Court will allow automobile expenses for trips to the blood lab and costs of special diets as business expenses. | |
