By volunteering – including the local school or PTA – you may have some surprise tax benefits waiting for you when you file your income tax return. The IRS allows you to deduct certain expenses incurred in connection with volunteer work. Below are several important deductions that you may be entitled to take when you file your taxes.
Mileage Deduction for Volunteering
The IRS allows you to deduct costs associated with the use of your car in connection with charitable work. You can either deduct the actual amount of gas and oil costs that you incur, or you can take a flat deduction of 14 cents per mile in 2022.
This includes mileage that you drove to and from the charity or the place where the charitable services were rendered. For example, if you volunteered for your children’s school PTA, you can deduct the mileage at 14 cents per mile for traveling back and forth between the school specifically for the volunteer work.
The IRS also allows you to deduct parking fees and tolls incurred while you were driving your car for volunteer work. Any car expenses that you claim must be documented, including receipts (parking, tolls or gasoline) and a record of your mileage.
If you engage in out-of-town travel in connection with volunteer work, those expenses are also tax-deductible. Here are a few examples:
- Air, rail and bus transportation
- Car expenses
- Lodging costs
- The cost of meals
- Taxi fares or other transportation costs between the airport or station and your hotel
The IRS has specific rules to deduct these expenses, including:
- You must volunteer to work for a qualified 501(c)(3) organization. Ask the charity about its tax-exempt status. You can also visit IRS.gov and use the Select Check tool to see if the group is qualified.
- The deduction qualifies only if there is no significant element of personal pleasure, recreation or vacation in the travel. However, the deduction will qualify even if you enjoy the trip.
- You can deduct your travel expenses if your work is real and substantial throughout the trip. You can’t deduct expenses if you only have nominal duties or do not have any duties for significant parts of the trip.
You can also deduct other out-of-pocket expenses that you pay during your charitable work. For example, you can deduct the cost of hosting a party or a fundraiser for the charity in your home. You can also deduct the cost of advertising that you pay for on behalf of the organization. If you incur any specific telephone-related expenses in doing your charitable work, those expenses will be deductible as well.
If the charity requires that you purchase and maintain a uniform (not suitable for everyday wear) in connection with your work for the organization, those expenses will also be deductible. You can also deduct the cost of letterhead and postage that you purchased in connection with the charity.
There may also be times when you purchase supplies for a charity, and those will be tax deductible. For example, let’s say that you purchase food for distribution to the underprivileged during the holidays, or at some other time during the year, the costs that you incur for that food will be tax-deductible.
You will be required to provide written records of the charitable expenses that you incur, which is particularly true for any significant expenses. For example, for any expenses that exceed $250, you must have either a statement from the charity describing the volunteer services, or a statement from the charity describing whether the charity provided goods or services to you.
What You Can’t Deduct
You can’t deduct the time that you spend doing work for the charity. For example, say you typically earn $30 per hour on your job. You won’t be able to determine that the 10 hours that you spent working for the charity last month has a value of $300 – 10 hours at $30 per hour – and then deduct that as an allowance for your labor.
You also cannot take a deduction for the use of your property in connection with the charity. For example, if you do any of the organization’s work from your home, you won’t be able to deduct the cost of your home in connection with that work.
Lastly, to take the volunteer expenses as a tax deduction, you must itemize on your tax return. If you’re doing any volunteer work during the year, such as with your local PTA, keep records of all that you do, and any expenses that you pay in connection with that work. Not only are you helping a good cause, but your expenses just may save you money at tax-time.
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