Gift

Friends A and B decide to buy and flip a house in 2020. As work begins, Friend A asks Friend C if she would be interested in helping with the design. Friend C is not a professional but is told by Friend A that if they make  profit, he will give her some undetermined amount. Due to unforseen conditions and Friend B not helping with labor, the project stretches into 2022.  Due to extra costs, it is assumed they probably will not make a profit, but actually lose money. Fortunately house prices are still high and the house sells and a profit is made. There is no written or oral contract between any of the parties and Friend C has not submitted an invoice for her efforts.  Friend A is happy and relieved to finally have the project completed and gives Friend C a check for $30,000.  Is the $30k a business expense for Friend A and business income for Friend C, or a gift from Friend A to Friend C?