An often overlooked charitable deduction is the deduction for mileage driven for charitable purposes.
Taxpayers can take a deduction — 14 cents per mile (this amount is set by statute and is not adjusted for inflation, so it’s been 14 cents for many years) — for mileage driven in giving services to a charitable organization, or taxpayers can take a deduction for the actual cost of gas and oil associated with giving services to a charitable organization.
Iowa taxpayers are allowed to take 39-cents per mile as a deduction. (Technically, the Iowa deduction is the standard 14-cents per mile as an itemized deduction, and then you can take another 25-cents per mile as an additional deduction. The net effect is 39-cents per mile.)
You volunteer to answer the phones once a week for a charitable organization. The organization’s office is 10 miles from your home. You can claim 20 miles (10 miles each way) as a deduction each week. If you do this 52 weeks a year, that would be 1,040 miles. At 14-cents per mile, the charitable mileage deduction would be $146. If you live in Iowa, your total deduction on your Iowa return would amount to $406.
Taxpayers can also deduct certain other out-of-pocket expenses incurred while giving services to a charity. For example, if the organization you volunteer for requires you to wear a special uniform, the cost of the uniform and the cost of dry-cleaning the uniform would be deductible.
The “value of your time” is NEVER deductible. In the example above, if a receptionist would be paid $10 per hour to answer the phones, you CANNOT claim a deduction of $10/hour for the time you spend doing that work.
Special rules apply to travel expenses other than mileage. Generally, you can’t deduct travel costs (airplane expenses, motels, etc.) for charitable work if there is any element of recreation to the travel. If you are planning to travel for charitable work, I would suggest consulting a tax advisor to determine if any of your travel expenses are deductible.