Between January 1st and April 15th we receive a lot of questions about how surrogate pay and taxes work! At Circle Surrogacy & Egg Donation, our surrogates and egg donors receive generous compensation, and many wonder if that income is taxable and if so, how it works.
We chatted with a few members of our Accounting team to answer some of the most asked surrogacy tax questions! The biggest takeaway from these conversations was that every journey is different and any questions specific to your unique situation should be discussed with your personal tax accountant! Check out some of our most asked questions below!
Egg Donor Taxes
Below are some of the most common questions that egg donors ask about the income made from being an egg donor.
Is egg donor compensation taxable income?
Yes, according to the IRS and as decided in historical court cases, egg donor compensation is taxable.
How do I file taxes for egg donation? Will Circle provide a 1099?
Yes, our accounting department will 1099s by the deadline provided by the IRS, which is no later than February 1st.
When will I receive my 1099?
All 1099s are mailed out by the IRS deadline of February 1st. All egg donors should receive their 1099 by the second week of February!
Why do I need a 1099?
Tax laws require Circle Surrogacy & Egg Donation to report egg donor stipends that we pay out to our egg donors. For information regarding your specific tax situation, please contact your tax accountant.
Below are some of the most common questions surrogacy agencies hear from surrogates about the income they make from acting as a surrogate.
Is income from surrogacy taxable? Do I need to report my surrogacy income?
Each surrogacy journey is different and we recommend discussing this with your personal tax accountant.
Why does Circle not provide 1099s for gestational carriers?
Current tax laws do not require Circle Surrogacy to report surrogate fees as taxable income at this time. If this were to change in the future, Circle would communicate this update!
If my journey bridges two different years, do I file the income each year or at the end of my journey?
Every surrogacy journey is different and every state has different laws around taxable income. We recommend discussing your specific situation with your personal tax accountant.
I live in a state that doesn’t have income tax; am I still responsible for paying taxes on the money earned from being a surrogate?
Similar to our previous answer, questions about tax questions specific to your state should be addressed directly with your personal tax accountant who specializes in tax law in your state.
For those that have additional questions about the income generated from being a surrogate or egg donor, please contact your personal tax accountant.