Can You Deduct Your Volunteer Expenses?

Many people perform many hours of volunteer work in our community, especially at this time of year. Volunteering can be a fun way to help your local community.  It can also reduce your taxes. 

In order to take tax deductions for your volunteer work, you will want to ensure the organization you are volunteering for is tax-exempt.  You can check online to be sure, or ask them if they are a 501(c)3 organization.

If you have expenses associated with your volunteer work, you may be able to take a tax deduction. For instance, one of our clients traveled to New Orleans after Hurricane Katrina to build houses for Habitat for Humanity.  Another is a scoutmaster for a local Boy Scout troop.  Several of our clients work with local food banks.

You may deduct the expenses you have which are necessary for you to do your work for the charitable organization. The Habitat volunteer paid for his own plane fare to do his work in New Orleans.  The scoutmaster purchases his own uniform.  The food bank volunteers drive hundreds of miles delivering donated food.  In order to deduct such expenses, you must have records and receipts.  To deduct mileage, keep a log of the date, place and purpose of your trip.

Other travel expenses you may deduct with proof include:

– Air, rail, and bus transportation

– Car expenses (such as parking fees and mileage)

– Lodging and meal costs while volunteering

– Transportation costs between airport or station and your hotel or work assignment location

You cannot deduct travel expenses if a significant part of your travel involves recreation or a vacation.  However the fact that you enjoy what you’re doing doesn’t mean you can’t deduct it.  Our scoutmaster loves hiking and camping, but the purpose for his trips is fulfilling his duties as scoutmaster.  He still can take a deduction for his expenses.

It’s important to note that you cannot deduct the value of your time to the organization.  So for instance, a financial planner who charges $100 an hour, and donates four hours of time to his school auction, does not get to take a deduction for that time.  A fundraising specialist who provides free advice to a non-profit cannot deduct that time either.

Do you still have questions about whether you can deduct some of your volunteer expenses, or what proof is required?  Give us a call, we’ll be happy to talk with you about it.