Help Families Confidently Navigate Crowdfunding So You Actually Get Paid
If you’ve been following the news over the past few weeks, you’ve heard about the Karmelo Anthony trial in Texas. One small aspect of the controversy that has kept this story in the headlines is a crowdfunding campaign that raised more than $630,000 on GiveSendGo, now shut down after his murder conviction, with lingering questions about whether the money went where donors intended. And then there’s James Van Der Beek, whose family raised millions after his death last year, triggering a backlash from donors who felt the Dawson’s Creek star’s estate hardly needed the public’s help.
Neither of those campaigns had anything to do with funeral expenses — but they’ve put crowdfunding ethics squarely back in the public eye. And for deathcare, that conversation has a very direct professional application: families raise money for final expenses on GoFundMe and similar platforms all the time, sometimes before they’ve even called you, and often without a clear understanding of how any of it works.
Here’s what you should know and what you can tell them to not only provide valuable guidance, but also to better your chances of being paid.
It’s “free,” but with asterisks
GoFundMe’s pitch is that it costs nothing to start or manage a fundraiser in the United States. That’s technically true. What families actually experience is a transaction fee of 2.9% plus $0.30 per donation, deducted automatically from every contribution before funds are transferred. On a $5,000 campaign funded by fifty $100 gifts, that’s roughly $175 that never reaches the family.
GoFundMe also prominently prompts donors to voluntarily tip the platform at checkout. Most donors do it without thinking. It’s not fraud; it’s just how the platform makes money.
The short version for families: if they’re counting on GoFundMe to cover a $6,500 funeral bill, maybe they should set their goal at least 5% higher than the actual amount owed.
Be the literal beneficiary
Most families don’t realize that GoFundMe allows the campaign organizer to designate a specific beneficiary — meaning they can name your funeral home, or the person in the family actually managing the arrangements, as the account that receives funds directly. This removes a step (and a layer of temptation) between the money and the invoice.
If a family comes to you mid-campaign, walk them to the beneficiary settings. It takes about five minutes and it’s the single most useful thing you can do to ensure you actually get paid.
The intent problem
The Anthony and Van Der Beek cases become a useful cautionary tale when it comes to intent — even if neither involved funeral costs.
GoFundMe doesn’t actively monitor how funds are spent after transfer. What it does require is that the money is used for the stated purpose. If a campaign says “help us cover Dad’s funeral and burial,” that language creates both an ethical obligation and a legal exposure. Using those funds for anything else — even legitimate grief-related expenses — can expose the organizer to civil dispute claims from donors and potential fraud accusations, per GoFundMe’s terms of service.
If a family raises more than they need? The platform’s guidance is that surplus funds can be redirected to related end-of-life costs (medical bills, immediate living expenses), provided the campaign is updated to disclose that. “Related” is doing a lot of work in that sentence, and donors who feel misled are protected by GoFundMe’s Giving Guarantee, which can result in withheld transfers or refunds.
FYI: The IRS is paying attention
One more thing families often haven’t considered: crowdfunding proceeds may be taxable. The IRS distinguishes between gifts (generally not taxable) and income — and whether a GoFundMe payout qualifies as one or the other depends on the circumstances and how much documentation exists. The platform itself issues a 1099-K if distributions exceed certain thresholds. Advising folks on tax implications is definitely outside of a deathcare professional’s wheelhouse, but it’s worth mentioning so families don’t come back to you six months later asking why they owe the government money they already spent.
The bottom line for your business
You don’t necessarily need to recommend GoFundMe or another all-purpose crowdfunding platform — the fees alone make it less attractive than payment plans or funeral financing programs you may already offer and a family can always (tactfully) request in the obituary that donations be made directly to the funeral home.
But when families arrive having already launched a campaign, you’re better off knowing this terrain than being surprised by it. Ask early whether a campaign is active, who the designated beneficiary is, and whether the fundraising goal reflects the actual invoice amount. Help them get the logistics right, and you’ll have a much cleaner path to getting paid.
