First only individuals who itemize their deductions on Schedule A of their 1040 can deduct charitable contributions. By our last count, only about a third of all taxpayers do that. So for the many non-itemizing taxpayers, any charitable contributions they make are not deductible.
Itemizing Expenses and Deducting Charitable Work Expenses
So for an itemizer, expenses that may be deductible are the ones that the volunteer receives no reimbursement for because, obviously, if a volunteer gets reimbursed, then there’s no out-of-pocket expense to deduct. So in order to be deductible, the unreimbursed expense has to be incurred in the volunteer activity that is directly connected to the work of the qualifying charity. And qualifying charity is a domestic organization recognized as tax exempt under IRC § 501(c)(3) or a federal, state, or local government. Any out-of-pocket expenses a volunteer might incur on behalf of not a 501(c)(3), so for example, a social welfare organization that’s exempt under (c)(4) or business league under (c)(6), would not be deductible.
What kind of expenses can volunteer deduct?
A volunteer may not deduct certain out-of-pocket expenses even when the expenses may facilitate the volunteer’s service to the charity. For example, as detailed in IRS Publication 526, the following personal expenses incurred by a volunteer are not deductible: babysitting expenses—a payment to a volunteer’s babysitter for the time the volunteer spends performing the services to the charity; travel expenses—the volunteer’s travel expenses for a trip during which the volunteer performed only limited work on behalf of the charity; clothing—purchase or dry cleaning of clothing that the volunteer uses during a service to the charity, but may also be used when he or she is not volunteering; and the cost of the volunteer’s food or drink while a volunteer is working if that work does not require the volunteer to be away from home overnight.
Example of Volunteer Charitable Expense Deductions
So let’s say, for example, that the volunteer goes on a sailing trip, and on his sailing trip, the volunteer agrees to count whales for eight hours a day. The IRS generally wouldn’t treat this cost—the cost of that sailing trip—as deductible because there’s a significant element of personal pleasure, recreation, or vacation in sailing trips in general.
What kind of Charitable Expense Deductions are Allowed?
So I guess it depends. If the time of the year is bad weather for sailing— if it’s cold, if it’s not a typical time of the year that people go on recreational sailing trips—then maybe the outcome would be different. Maybe the IRS would consider that a charitable contribution, but it really depends on the facts and circumstances.
Deducting Travel Expenses as Volunteer
The Internal Revenue Code specifically states that there’s no deduction for any travel expenses unless there’s no significant element of personal pleasure, recreation, or vacation in such travel. That doesn’t mean that the volunteer can’t enjoy volunteer work—that, in and of itself, doesn’t give it a significant element of personal pleasure, vacation, or recreation. It also doesn’t mean that the volunteer can’t do something fun at the end of the day. But it just means that, for a full workday, the volunteer has to be there for the volunteer work, and there can’t be a significant element of personal pleasure, recreation, or vacation in general. And you can find that in § 170(k) of the Internal Revenue Code.