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LawTalk, Attorney
Category: Legal
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Experience:  I am a practicing attorney with more than 3 decades of experience in the legal field.
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I want to set up a Personal Legal Defense Fund for myself to

Resolved Question:

I want to set up a Personal Legal Defense Fund for myself to help pay for legal fees pertaining to my immigration legal problem. I have many friends and family willing to donate to this legal fund but I don't want to create more problems with the federal government for myself than I already have. My questions are how should I go about creating a Legal Defense Fund for myself in Texas and what IRS forms should I fill out?
Submitted: 5 years ago.
Category: Legal
Expert:  LawTalk replied 5 years ago.
Good morning,

I'm sorry to hear of the situation.

I'm not sure what you are trying to accomplish here---but if it is to establish a non-profit organization which is a charity, and which people donating to your organization can write off their payments as charitable contributions---well, you cannot do that for a defense fund that solely supports your personal legal expenses. A charity, which allows donors to write off their donations on their taxes, may not be established it simply helps you, or one person in particular. Charities must be established to assist a group---not just one or several people. Simply stated, if your purpose is to help some particular individual or family, or small group of named people, then it’s not a charitable purpose, and will not be allowed as the basis for a charitable trust under federal law.

However, your family and friends are free to make monetary gifts to you, but if they do, they may not write off those donations. However, they do not have to pay any gift tax on their donations to you either, so long as they do not give you more than $13,000 each.

I wish you the best in 2012.

I understand that you may be disappointed by the Answer you received, as it was not particularly favorable to your situation. Had I been able to provide an Answer which might have given you a successful legal outcome, it would have been my pleasure to do so.

You may reply back to me using the Reply to Expert link if you have additional questions; and if you do, I ask that you please keep in mind that I do not know what you may already know or with what you need help, unless you tell me.

Please recognize that the rating system only gives me credit for working with you when you click one of the 3 stars/faces on the right (positive rating). Also, kindly rate me based solely on my service to you in understanding the law, and not based on whether my answer is what you were hoping to hear. I have no control over the how the law impacts your particular situation, and I trust that you can understand how it would be unfair for me to be punished by a (negative rating) ----the first 2 stars/faces----for having been honest with you about the law.

Thank you,

Customer: replied 5 years ago.

Thank you for prompt and honest reply. I am actually not surprised by your answer to my question. I was seeing some conflicting information when doing my research and I simply wanted to be sure that I could NOT do that.

Would you recommend that I simply ask for donations from friends and family and have them deposit into my personal account? Or should I create a separate account just for this purpose? My main concern is to not get "cross-wise" with the IRS or any other government entity.

Thanks again for you help and I will give you the highest rating. I wanted an answer and whether it was negative or positive was/is besides the point.
Expert:  LawTalk replied 5 years ago.
Good afternoon,

There is nothing to get cross-wise with the IRS about. Anyone may make a gift of cash to you of up to $13,000 a year---for any reason, and the gift is neither taxable to you, or to the giver, of the money.

All you need do is open an account, or use an existing account, and you may either place money there as you receive it, or you may make the account number available to friends and family and they may donate directly to it by going to the bank or a branch of the bank, anywhere in the country.

I wish you success in your battle!

You may reply back to me again, using the Reply to Expert link, if you have additional questions.

LawTalk and 3 other Legal Specialists are ready to help you