The detail
A reward-based pledge looks a lot like a sale: the backer pays, the business delivers something. That is why it is usually recorded as income rather than as a gift.
Fees paid to the platform and the card processor, and the cost of making and posting rewards, are generally deductible business expenses against that income.
Every situation differs, and we cannot give tax advice. Show your campaign totals and fee breakdown to your accountant before you file.
Read the full guide
Every fee on a crowdfunding pledge in plain language — platform fee, card processing and the hidden costs most owners forget — with the real math on a $25, $50 and $250 pledge.
A step-by-step guide to raising money for a small business from your own community — what to ask for, how long to run, and what to offer backers in return.
Keep reading
Not on a reward-based platform like Pledzy. You owe backers the reward you promised, not repayment of the money.
5% of each pledge — 3% for verified nonprofits — plus card processing of 2.9% and 30¢ per pledge paid to the payment provider.