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If you’ve been volunteering your time helping those affected by Hurricane Sandy, or perhaps you are planning to do some volunteer work during the holiday season, you might also be doing yourself a favor and not even know it! Some types of volunteer work and charitable donations are tax deductible and can be included in your tax return if you itemize your deductions on a Schedule A.
Although you cannot deduct the time or value of your services given to a qualified organization, you may be able to deduct some amounts you pay in giving services to a qualified organization.
The expenses must be:
- Unreimbursed — you can’t double-dip if the charitable organization reimburses you,
- Directly connected with the services,
- Expenses you had only because of the services you gave, and
- Not personal, living or family expenses.
Any deductions from volunteering must be with an IRS-qualified organization. You can check on the IRS website to see if the organization’s has tax-exempt status. Click here to search for eligible donation organizations. In addition, you may verify an organization’s tax-exempt status and eligibility to receive tax-deductible charitable contributions by asking to see an organization’s IRS letter recognizing it as tax-exempt. You may also confirm an organization’s status by calling the IRS (toll-free) at 1-877-829-5500.
Here’s a summary of what you can deduct while volunteering:
Mileage — Often it’s easiest to use the standard mileage deduction rate. Currently, charity-related mileage deduction is 14 cents per mile. Check the IRS website for current rates. Volunteers can also add parking fees and tolls. Save your receipts.
Other transportation — You can also count public transportation, such as the bus, train or taxi fares incurred while volunteering.
Travel — Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel.
Keep in mind that enjoying your volunteer work doesn’t rule out a deduction as long as you are volunteering in a genuine and substantial sense throughout the trip.
Deductible travel-related expenses include:
- Air, rail and bus transportation,
- Out-of-pocket expenses for your car,
- Taxi fares or other costs of transportation between the airport or station and your hotel,
- Lodging costs, and
- Cost of meals.
Basically, a volunteer who travels away from home overnight can deduct the same types of expenses that may be claimed by a worker who makes a similar trip for business with one important exception: The volunteer travelling overnight for charity may deduct all meal costs. Volunteers are not subject to the 50 percent limit that applies to business meal deductions. However, expenses incurred by a spouse who is not involved in the volunteer effort are never deductible.
Uniforms — You can deduct the cost and upkeep of uniforms that are not suitable for everyday use and that you must wear while performing donated services for a charitable organization.
For more information, see the IRS Publication 17 section on “Out of Pocket Expenses in Giving Services.”
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