Other Tax Questions
Questions and comments on other topics covered in Fairmark.com, such as UTMA accounts, and any tax questions that don't fit our other categories.
Is money from donating plasma taxable?
Posted by: plm, October 3, 2007 04:20AM
I searched on the internet to try to find an answer, but didn't come up with much. Found one site that mentioned getting a 1099 for donating plasma (for cash).

Plasma donation centers do make you provide a social security number. So DO they give a 1099 and is the money taxable?

Re: Is money from donating plasma taxable?
Posted by: Bill Brown, October 3, 2007 03:52PM
Whether you receive a 1099 or not this income is taxable. Report it on the "other" line of Form 1040.

Re: Is money from donating plasma taxable?
Posted by: Art, October 3, 2007 03:53PM
A 1099 does not have to be issued if the total yearly amount is under $600. None the less, such payment is taxable income and should be declared as such. [Yeah, sure]

outside the tax system
Posted by: jainen, October 3, 2007 04:25PM
>>[Yeah, sure]<<

Most people selling their own body parts either don't have enough income to require filing or are otherwise outside the tax system.

Re: Is money from donating plasma taxable?
Posted by: WD Kebschull, October 3, 2007 06:21PM
Bill Brown wrote:

Whether you receive a 1099 or not this income is taxable. Report it on the "other" line of Form 1040.

Just be sure to subtract the costs relate to the "manufacture, storage and transportation of the plasma" from the sale price. :-).

Cheers,

WDK

Re: Is money from donating plasma taxable?
Posted by: WD Kebschull, October 3, 2007 06:25PM
Bill Brown wrote:

Whether you receive a 1099 or not this income is taxable. Report it on the "other" line of Form 1040.

Just be sure to subtract the costs relate to the "manufacture, storage and transportation of the plasma" from the sale price. :-).

Cheers,

WDK

Re: outside the tax system
Posted by: Art, October 3, 2007 06:30PM
>>Most people selling their own body parts either don't have enough income to require filing or are otherwise outside the tax system.
<<

So they might qualify for EIC?

Re: Is money from donating plasma taxable?
Posted by: ruth, October 3, 2007 09:00PM
Not only is it taxable, but if the plasma is sold regularly, the taxpayer may be considered to be in a trade or business and can deduct ordinary and necessary business expenses. See the discussion of Green 74 TC 1229 (1980) at [books.google.com]

Re: Is money from donating plasma taxable?
Posted by: Bill Brown, October 4, 2007 12:57PM
The tax basis in bodily parts is zero. Kebby knows this. He's just being a trouble maker.

Re: Is money from donating plasma taxable?
Posted by: Kaye Thomas, October 4, 2007 02:04PM
Well, he did put a smiley after his comment. But in any event, the Green case cited by Ruth supports deductions in those categories, but only for someone in the trade or business of selling blood.

As it happens, that case was under consideration by the Tax Court the year I took my first tax course in law school. The professor used the facts of the then undecided case as the basis of one of the questions on the final exam. It's one of those fun situations where you can argue all kinds of things different ways. For example, the IRS wanted to disallow the deduction of travel costs to sell the blood, arguing that it amounted to commuting. The court disagreed, though, because in the unique facts of this case the taxpayer's travel to the site where the blood was drawn constituted the only practical way to transport the "product" (the blood), so it was a deductible transportation cost. The court wouldn't allow a deduction for depletion, though. BTW, the taxpayer received around $7,000 for the blood in 1976, back when $7,000 was a lot of money, based on a very rare blood type.

Kaye Thomas
Fairmark.com

undignified comparison
Posted by: jainen, October 4, 2007 02:29PM
>>for someone in the trade or business of selling blood<<

The article quotes the court's rather undignified comparison to "hen's eggs, bee's honey, cow's milk, and sheep's wool." Sounds like Schedule F is the way to go.



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