The IRS will not allow individuals to deduct the monetary value of their volunteer service to a nonprofit on their individual income tax returns. But volunteers may be able to deduct for certain volunteer expenses.
Your donation will be deductible only if it is made to a qualified nonprofit, tax-exempt organization. That is, the IRS must have granted 501(c)(3) tax-exempt status to the group.
You can deduct certain expenses for charity work, like the standard rate of 14 cents per mile. You can also deduct the cost of purchasing and maintaining uniforms you wear to a place you volunteer or parking that is required.
- Example: During the year you volunteer 8 times at a nonprofit organization that is 20 miles away (round trip: 40 miles). The total number of miles traveled for your volunteer service is 320 miles for the year. Your deduction for mileage to volunteer would be $44.80.
- Example: The nonprofit hospital you volunteer at requires you to wear scrubs. You must purchase them, pay to clean them, and they are not suitable for everyday use. This is an appropriate expense.
Also, away-from-home travel expenses while performing services for a charity (out-of-pocket round-trip travel cost, taxi fares and other costs of transportation between the airport or station and hotel, plus lodging and meals). However, these expenses aren’t deductible if there’s a significant element of personal pleasure associated with the travel, or if the services for a charity involve lobbying activities.
Other possible deductions that you may have from volunteer work may include supplies you purchase to be used in volunteer work, such as stamps and stationery. Certain expenses tied to hosting a fundraiser or event for the organization may be deductible, as well.
Keep good written records of expenses related to your volunteer work. Start a mileage log and keep it up to date (there are good tech options for doing this, such as smartphone apps Everlance, TripLog, and TrackMyDrive). Keep all your receipts.
However, filers who plan their charitable gifts may be able to get themselves over the new standard deduction and itemize — if they use a strategy called “bunching.”
Clergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas.
This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. If you are seeking legal advice, you are encouraged to consult an attorney.
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