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R. Klein, EA
R. Klein, EA, Accountant
Category: Financial Software
Satisfied Customers: 3374
Experience:  A member of the Intuit Ask a Tax Expert team and 10 years as QuickBooks Certified Pro Advisor.
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Recording Charity Events/Photography Studio

Resolved Question:


I am a photographer who does portrait fundraisers occasionally during the year. I donate 100% of the sitting fees for such portrait events straight to charity, and give the customer a $25 print credit for attending the event. 


Question: Can I just record the sitting fees as regular income and then record the donated fees as "advertising expense"? Since I do these events to get exposure?

Submitted: 3 years ago.
Category: Financial Software
Expert:  R. Klein, EA replied 3 years ago.

R. Klein, EA :

Hello and thanks for your tax question.

R. Klein, EA :

Are you operating your business as a sole proprietor or as an S-corporation or C-Corp?

R. Klein, EA :

In general, if you are collecting ANY money, then the full amount is reported as revenue.

R. Klein, EA :

The amount you donate to charity is booked as charity or donation. How this is treated for tax purposes depends on your entity type.

R. Klein, EA :

You would not book the donations as "advertising expense" though, to be proper. It's a charitable contribution.

R. Klein, EA :

These contributions are subject to certain limitations, often no more than 50% of your gross income.

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Customer: replied 3 years ago.
Thanks so much!
I was previously advised to mark the income as advertising, so I wanted another opinion.
I'm a sole proprietor, does that change your answer any?

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