Volunteering at local charities, such as your PTA, may give you some valuable tax breaks, such as deductions for mileage, travel expenses and out-of-pocket expenses. There are rules of course, that you must adhere to.
The IRS allows you to deduct expenses associated with the use of your car, either actual expenses or a flat mileage deduction (17 cents per mile in 2017). This includes the mileage that you drove to and from the charity or the place where the charitable services were rendered.
Other travel expenses may also be deductible, including air, rail or bus, lodging, meals, as well as taxi fares between your temporary lodging and place of charitable work.
There are 3 requirements for a volunteer travel expense to be deductible; a) you must volunteer to work for a qualified 501(c)(3) organization (The IRS maintains lists of eligible charities on its website, www.irs.gov), b) there must be no significant element of personal pleasure, recreation or vacation in the travel (which doesn’t mean you can’t enjoy the trip), and c) the work performed is ‘real and substantial’ throughout the trip.
What is and isn’t deductible is often subject to an interpretation as to what the IRS guidelines mean. For instance, let’s look at what ‘real and substantial’ expenses throughout the trip might mean. Let’s say you are a Marlins fan and you travel to FL to see a game. You are there for 3 days and while there, you spend 4 hours donating time to a charity. Traveling to the charity from your hotel and back would be deductible but not the expenses of traveling to FL and back. But, if you traveled to FL to participate in a charitable event over 3 days, and while there you went to a Marlins game, travel to and from FL would be deductible.
Finally, some out-of-pocket expenses could be deductible. Some examples of that might be advertising expenses you incurred to promote a charitable event, food expenses incurred while hosting a fundraiser, postage expenses or other items purchased for the charity.
So, besides making you feel good, that charitable work could put a few bucks in your pocket. Remember though, the IRS doesn’t care how nice you are. If you don’t have receipts for those expenses, you will never win the audit.