• Skip to primary navigation
  • Skip to main content
  • Skip to footer

Micro Business for Teens

Starting and running a micro business

  • Home
  • About
    • Speaker/Workshops
    • Media Kit
    • What Others Say
  • Products
    • Micro Business for Teens Curriculum
    • Starting a Micro Business book
    • Running a Micro Business book
    • Money and Taxes in a Micro Business
    • Micro Business for Teens Workbook
    • Video: Starting a Micro Business
    • Career Exploration
  • Teacher Resources
  • Contact
  • Blog

Starting a Micro, Money & Taxes, Blog · January 17, 2014

What is crowdfunding and can a teenager get in on it?

You are here: Home / Starting a Micro / What is crowdfunding and can a teenager get in on it?
Credit: https://www.salon.com/2013/04/10/kickstarter_just_might_get_you_audited_partner/

What is crowdfunding?

The word seems to be a hot term that’s used everywhere. Anytime someone needs to raise some money for a project they turn to crowd source or crowd fund. But what exactly does that mean? Well Venturebeat.com best describes it as:

“crowdfunding is funding from a crowd of people; that is, many people provide small amounts of money to finance something. Crowd funding has its roots in charitable causes, including the advent of micro financing to provide financial services to poor people, but has progressed to the online funding of creative and other projects via sites like Kickstarter and Rockethub…” Read more on VentureBeat

Can a Teenager Start A Crowdfunded Project?

Crowdfunding may not work for micro business owners under age 18, because legal contracts with minors are not legally binding, so most investors will not make a contact with a teenager.

But with that said, there are a few teenagers that have used sites like Kickstarter to launch their project. In fact, I just wrote a blog post about a teen who crowdsourced an iPad app last week, you should check it out. You might also want to check out his Kickstarter page to see that the project wasn’t launched under Emerson Walker’s name, but his father’s instead. This is most likely because of my reasoning mentioned above, legal contracts with minors are not legally binding.

Keep Good Records and Be Careful Not To Get Audited

Another thing to keep in mind is that any funds that you make off of your crowdfunded project are considered “taxable income” by the IRS. Even though you are not selling a product via a crowdfunding site like Kickstarter, the IRS will see the transaction as a taxable income because the IRS defines gross income from ‘whatever source derived,’. You can read more about this on Salon.com.

But crowd funding is definitely something to keep in mind for your future.

Carol Topp, CPA

 

P.S. Here’s a neat story of how some students pay for college through crowdfunding: New crowd funding site helps kids with little money achieve big college dreams

 

 

Related posts:

  1. CreateSpace for minors?
  2. Economic Self Reliance for Your Teenager
  3. How to deal with royalty payments to a parent, instead of the teenager
  4. Teenager makes $5000/month from Google Ads
  5. What Your Teenager Can Learn from Starting a Micro Business

Filed Under: Starting a Micro, Money & Taxes, Blog Tagged With: Starting a Micro Business, crowdfunding, entrepreneur, money, start up, taxes

Carol Topp, CPA

Footer

Connect with author Carol Topp, CPA

Tags

accounting advertising Author business business plan Career exploration Carol Topp customer service debt Dollars and Sense Show entrepreneur how to start a business idea Ideas legal Marketing micro business micro business for teens Micro business idea money PBS podcast product based business publishing record keeping running a micro business sales sale tax service based business start a business start a micro business Starting a Micro Business start micro business start up success taxes teen teenage author teenager teenagers teen business teen business idea Ultimate Homeschool Radio Network website writing

From a parent

Thank you for your e-book on teen micro businesses. Your valuable experience and wealth of knowledge is vast.

Your presentations at Cincinnati homeschool conferences and sharing with us over the years have benefited us well.

I can hardly believe we are at this point in our life-and here he is a young man ready to try his fortune with the world.

-Mandy S

Newsletter

Copyright © 2023 · Showcase Pro on Genesis Framework · WordPress · Log in