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Author: badlemming One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121482  
Subject: Egg Donation & Taxes Date: 4/6/2000 8:15 AM
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Hi all,

I'm about to donate an egg to friends of mine so that they can have a child (they're infertile). I will be receiving $2500 sometime this year for the service, and I suspect that I'm going to be taxed on that somehow.

Does anyone know whether this might count as income, a gift, self-employment...? I'm sure there's plenty of precedent but haven't been able to find out what it is.

thanks,
badlemming

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Author: edcosoft Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 33646 of 121482
Subject: Re: Egg Donation & Taxes Date: 4/6/2000 11:52 AM
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I'm about to donate an egg to friends of mine so that they can have a child (they're infertile). I
will be receiving $2500 sometime this year for the service, and I suspect that I'm going to be
taxed on that somehow.

Does anyone know whether this might count as income, a gift, self-employment...? I'm sure
there's plenty of precedent but haven't been able to find out what it is.


Put it on line 21 of 1040. Ed

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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 33751 of 121482
Subject: Re: Egg Donation & Taxes Date: 4/7/2000 10:15 PM
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<<I'm about to donate an egg to friends of mine so that they can have a child (they're infertile). I
will be receiving $2500 sometime this year for the service, and I suspect that I'm going to be
taxed on that somehow.

Does anyone know whether this might count as income, a gift, self-employment...? I'm sure
there's plenty of precedent but haven't been able to find out what it is.>>

You might be surprised that there is very LITTLE precedent. And it's an interesting issue...something that I would like to kick around AFTER April 17th.

The only case really close to being on point is Green v. Comr., 74 T.C. 1229 (1980)...it had to do with the sale of rare blood plasma. I haven't reviewed that case for a number of years. But my recollection is that the court deemed the body part a capital asset unless the taxpayer regularly sold the product to customers...in which case it would receive ordinary income treatment.

So I'm not so sure, but I don't have time to do any real research on it right now. It's certainly taxable. And I doubt that this is something that you do all of the time, so it would likely NOT be self employment income.

But I'm not so sure if it would be ordinary income or capital gain income. And if capital gain income, would the "egg" be considered long term. You will have no "cost basis" in the egg...that's clear. But if the egg is a capital asset, would it be considered long term...rendering preferred tax treatment?

Again...interesting. Hang on until after April 17th and perhaps we can kick it around.

TMF Taxes
Roy

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