A lot of bloggers and “citizen journalists” hope that writing for sites like CNN iReports, The Huffington Post, or FOX uReports for free might be a good way to break into professional journalism–or just raise one’s public profile.
But now a tax expert is saying that if the value of the writer’s submissions exceeds $12,000, they owe the IRS gift tax:
Stinkyjournalism.org: The IRS defines gifts on its web site: “You make a gift if you give property (including money), or the use of or income from property, without expecting to receive something of at least equal value in return.” Thus, when citizen journalists give content to media outlets, they are making a gift. Surprise! Most people do not realise that donors, not recipients, pay gift taxes.
Read more of the post for an exhaustive analysis of how gift tax works, how “fair market value” is calculated, and (legal) ways to minimize any tax bill owed.
Thankfully, in this miserable environment for journalism, a blogger would have to give away a lot of free content to exceed a “fair market value” of $12,000. But what about celebrity HuffPo bloggers like Harry Shearer or Alec Baldwin, who draw huge traffic to the site? Are they paid? And if not, what might the tax bill be for their “gifts” to Arianna?
Business Insider Emails & Alerts
Site highlights each day to your inbox.