"Crowdfunding sites generally use a payment processor like PayPal to handle the donations, and PayPal is responsible for reporting information to the IRS on payments of $20,000 or more made up of 200 or more transactions, which creates a 1099-K form. If you earn other income through PayPal, perhaps from an online business, that income could be combined with your crowdfunded money to create a bit of a financial mess.
