Taxes and Traveling for Charity

Over the summer months, some people might travel to participate in charity work.  Not only is that a wonderful, selfless contribution to society, but it could also be tax deductible!  For the purposes of this blog we will not be delving into the warm, fuzzy feelings volunteering gives, but the potential tax deductions that you could qualify for.

The following are a few tax tips to keep in mind to ensure a better tax refund.

Qualified Charities

This might seem like a no-brainer, but it is very important to make sure that the charity falls under the IRS guidelines as a qualified charity.  Churches, governments, and school trips generally fall under the umbrella of qualified charities and need not apply, but most groups need to apply to the IRS to be eligible.  Of course, it is completely up to the person about whom they volunteer or donate to, but to be sure you can deduct expenses or donations it is smart to ask the group about the tax status.  The IRS has a handy tool to ensure your group’s status- the IRS Check Tool.

Out-Of-Pocket Expenses

You may find that the money you spent on your trip is deductible.  Personal expenses are not covered and these expenses must be directly related to the trip.  For example: if you threw a charity dinner- that could be deducted from taxes; the bar trip afterwards celebrating your successful dinner- that would be a personal expense and not tax deductible.  In order to be eligible for a refund, the expenses must not have been reimbursed, directly related to the services you provided, and not personal, living, or familial expenses.

Genuine and Substantial Duties

A substantial part of your trip needs to be the charity work for tax deduction purposes.  If the majority of your trip is personal time, you cannot expect to have your expenses deducted.

Value of Time or Service

This simply means you cannot use charitable work as a stand-in for your job.  This would include time lost to go do charitable work in lieu of work.  Even though you make X-amount an hour, that does not mean you can expect that to be a refundable “expense”.

Travel Expenses Deductible

You may be eligible to include your travel expenses in your deductions.  This would include plane, train, and bus transportation.  If you travel by personal vehicle it may include mileage accrued.  You will also find that you can deduct your personal accommodations and meals during your stay.  Ubers, taxis, or Lyfts are also deductible.  As long as you used them back and forth between the airport, station, and hotel.  Again, if your charity work does not encompass a substantial portion of your travels, you do not qualify for these deductions.

For further reading, checkout Publication 526 for more info on these rules and what is and what is not considered eligible, and as always contact us for any tax questions or comments!

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