By Shannon Nash
Did you know you could be missing out on hundreds of dollars in tax deductions? Many of you volunteer for Cure Autism Now and other nonprofits. The community appreciates your generosity. Uncle Sam appreciates it too. The IRS recognizes your dedication with a tax break for out-of-pocket volunteer expenses.
Out-of-Pocket Volunteer Expenses
Any out-of-pocket expenses related to your volunteer activities on behalf of a nonprofit are deductible as charitable contributions. This includes travel, transportation, meals (only when away from home overnight) and lodging. Costs related to the use of your personal car may also be deducted either by taking the actual out-of-pocket expenses, such as gas and oil, or the standard mileage deduction (14 cents per mile). Costs for parking and tools may be deducted under either method.
For example, a dedicated CAN volunteer - let's call her "Sally Do-Gooder" - is on her local WALK NOW planning committee. Over several months, Sally drives to a WALK-related meeting once a week. She also uses her car when meeting with local businesses regarding sponsorship. She then drives her car to deliver brochures to local retailers and community organizations. On the day before and the day of the WALK she drives 60 miles round trip to the WALK venue.
While enjoying a foot massage after the Walk, Sally calculates her total mileage for all of these Cure Autism Now-related activities as 876 miles and has a total of $60 in parking fees. She had also mailed Walk brochures, spending $50 on postage. While reviewing her phone bills from the four-month period she was active on the planning committee, she estimates that 35% of her calls were Walk-related. Over the same period, she estimates that she used her internet and home email 40% of the time for Walk activities. After several months of doing good, Sally had $328.64 in out-of-pocket volunteer expenses related to WALK NOW that she can deduct as charitable contributions.
To claim out-of-pocket and mileage expenses, you must keep good records - such as a journal or a mileage log - to prove or substantiate your deduction. If any single expense is more than $250, you must get a written receipt, with specific IRS language, from the organization to take this deduction. You don't have to include these
receipts when you file your tax return. But you will be asked to provide them if you are audited, and even do-gooders get audited sometimes. (Note: You're generally required to keep these records for three years.)
(For more information on this and other charitable contribution deductions see, IRS Publication 526, Charitable Contributions.)
Out-of-pocket expenses are just one of several deductions that you may be able to take in connection with your special needs child. Don't forget to also ask your tax preparer about: Mileage driving to and from doctor visits and other medical related trips are 18 cents a mile for 2006.
Tax planning and preparation expenses in connection with big expenditures like setting up your special needs trust, your 529 Plan or Coverdell Educational Savings Account.
These tips were prepared especially for Cure Autism Now volunteers by Cure Autism Now Board Member Shannon Nash. Nash is an attorney and CPA who volunteers her time with many nonprofits, including CAN. She owns and operates The Nash Group, a tax and nonprofit consulting firm. You may contact her for more information at SNash@nashgroup-usa.com.
You may also find some helpful tax hints in this article, "Tax Benefits for Parents of Children with Learning Disabilities," from SchwabLearning.org.
 Mileage at $122.64 (876 x $0.14 cents a mile), Parking at $60.00, Postage at $ 50.00, Mobile Phone at $56.00 (4 months x $40.00 x $0.35), and Internet at 40.00 (4 months x $25.00 x $0.40).