Unreimbursed expenses incurred while providing volunteer services to a qualified organization are deductible as a chararitable contribution. Volunteer services include your unpaid service as a board member, convention delegate, office worker, case worker, Scout leader, researcher, etc.
Qualified organizations include not only charities and foundations but also certain veteransâ groups and fraternal lodges. Basically, any organization to which you can make a deductible charitable contribution qualifies.

What expenses are deductible? 
All of the volunteering expenses that follow may be deductible.


Commuting expenses. If you use your own vehicle, you may either deduct the actual costs of operating the vehicle for charitable work or use a flat rate of 12 cents per mile for 1997.
Actual costs are gas, oil, and repairs directly related to the use of the vehicle for official duties, but not general repairs, depreciation, or insurance. Parking and tolls may be deducted in addition to the costs calculated under either of the two methods.

 

Travel expenses. If you travel away from your home overnight to provide services for the organization, the unreimbursed costs for plane or train (or other) tickets, as well as lodging and meals, are deductible. The trip must be authorized by the organization and have no significant element of personal pleasure, recreation, or vacation.


Uniform expenses. If there is a requirement that the uniform be worn while volunteering and it does not have general utility, the cost is deductible.


Office expenses. The costs of providing materials and supplies, such as stamps and envelopes, are deductible. Telephone calls made in the course of volunteering are also deductible.


Other expenses. Examples are (1) the cost of meals for underprivileged children you are working with; (2) out-of-pocket expenses for living quarters, food, and clothing used in caring for a refugee on behalf of a charitable resettlement agency or church group; and (3) out-of-pocket expenses to provide meals and lodging to visiting contestants competing in an amateur athletic event sponsored by an amateur athletic organization.

What expenses are not deductible?
Non-deductible expenses include: the value of your donated services, the cost of your meals not incurred while traveling or away from home overnight, expenditures made for the purpose of influencing legislation, and day-care expenses for your own children while you volunteer. (These expenses are also not dependent-care costs since they are not related to a paying job.)


What records should I keep?
Keep canceled checks and receipts to substantiate your out-of-pocket expenses. For expenses of $250 or more for a single event or activity incurred After December 16, 1996, a statement from the charity is required. The statement must describe the services you provided, state whether you received goods or services from the organization in return and, if so, provide an estimate of the value received. The statement must be received by the earlier of (1) the date you file your return or (2) the due date including extensions. Obtain the statement as soon as possible after the event to avoid missing the deadline.


What's the IRS doing?
New areas of focus include tax-exempt organization gaming
(gambling) activities and identifying social clubs (Section 501(c)(7) organizations) that are not reporting their investment income as unrelated business taxable income on Form 990-T.
Intervention by exempt organizations in political acitvities will be a focus on a regional basis. n
©1997. Mulligan, Topy, & Co. and NPI, used by permission.