Are individuals who receive a donation from a 501(c)(3) org taxed on their receipt of that donation? Where?
Answer:
Financial assistance from a nonprofit organization is not generally taxable income. If you provide a service to the organization and are paid for it you will get a W-2 (for an employee) or a 1099 (for an independent contractor). But actual charity is just a gift, not taxable either to you or to the giver, provided the giver is a tax-exempt organization. (There is such a thing as a gift tax payable by the giver when the giver is a tax-paying individual, but only very rich people have to worry about that!). The organization has to report on specific assistance to individuals on its 990 tax return, including the standards by which it determines who gets help, but that's the only IRS obligation. Other Questions and Answers: