Lawyer for Indie Media | Sue Basko
You should check with a lawyer and give them all the information about who is holding the benefit and for what purpose. If you plan to run a benefit, you should definitely contact a lawyer and discuss your whole plan. Many times a benefit is run by a nonprofit organization and then it is subject to the rules and laws under which the organization operates. Many states require anyone who solicits charitable contributions to be registered as a charity. People often throw an impromptu benefit when someone in their community needs medical care or funeral expenses or other such things. These are usually not part of any nonprofit entity. These may or may not be legal, but they are common. It is probably a smart idea to run any such benefit through a nonprofit, such as a church. Some benefits are run with donations sent directly to a bank. I think the money donations given are considered gifts to the person receiving them and a person can use a gift any way they like. If a person or group runs a benefit and is raising money, but not giving it to the person or group they say they are giving it to, that might be considered fraud. There have been instances where people donated money to a person in actual need and the person spent it on things that others in the public thought were improper expenditures. For example, there were news stories of people donating money to a mother with many young children and news stories saying she had spent some of the money on tattoos. If you are running a benefit for a needy cause, you want to be sure the money goes to the cause and is spent on the needs that people are giving it for. Having a lawyer help you structure the plan will help.
Answer Applies to: Illinois
Sebby Law Office | Jayne Sebby
Income from a benefit must go to the entity or person that the benefit is being held for. Expenses may be deducted from the profit but if the expenses are too great a percentage of the income, it starts to look pretty suspicious.
Answer Applies to: Nebraska