CalNonprofits Articles

MileageDriverIf Jane Doe -- let's say an attorney -- drives her car to a business meeting with a client, she can now (as of January 1, 2015) deduct 57.5¢ per mile on her tax return. If she drives, for instance, 50 miles, she can deduct $28.75. If, the next day she drives her car 50 miles to volunteer as an attorney at an immigration rights clinic, she can only deduct 14¢ per mile... $7 total.

The IRS raised its rates for business mileage from 56¢ in 2014 to 57.5¢ for 2015. We're glad the IRS has recognized that mileage costs have gone up, but they've gone up for volunteers, too! CalNonprofits has consistently supported efforts to make the volunteer mileage deduction equal to the business mileage deduction, but once again the IRS has not listened.

But don't forget to let volunteers know they can deduct unreimbursed mileage and other costs of doing volunteer work:

Mileage: 14¢ per mile

Transportation: bus, train, streetcar fares to get to and from volunteer activities

Home fundraisers: catering expenses if a volunteer hosts a board meeting, fundraiser or other event at his or her home

Reminder: such deductions are usually only for volunteers who itemize on their tax returns. Nonetheless, let all volunteers know about these possible deductions. It's one way that nonprofits can express their support for volunteerism. We've provided a Sample Form for Volunteer Mileage Deductions you can give to volunteers, in an easy-to-customize Word format.

Comments   

0 # Jan Masaoka 2015-02-03 13:46
To our knowledge the IRS is not enforcing the decision that reimbursement to a volunteer of more than 14 cents is taxable to the volunteer. This is not part of their published regulations but was written in a private advisory letter to a CalNonprofits member who shared it with us.

If this is a concern for your organization and/or your volunteers, you can ask the IRS for an advisory letter. Until the IRS publishes this interpretation and begins to enforce it, it’s probably not a public policy priority to change it. Thank you for your question and concern!
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0 # Marti Crane 2015-02-03 09:19
I'm curious to know if the #4 comment by Katie Kleinsasser is an absolute. The part about the difference between .14 and the actual amount paid being a taxable income to the volunteer is quite disturbing.

How do you suggest we move forward from here?

Thank you!
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0 # Katie Kleinsasser 2015-01-15 10:17
Another member advises that "it's worse than you think." The Alert suggests the possibility of reimbursement. What if the nonprofit does reimburse the volunteer at the business rate, 57.5 cents per mile? We looked into this on behalf of a client, and it turns out the difference between that and 14 cents/mile is apparently TAXABLE income to the volunteer, and may require a 1099 if over $600! The IRS doesn’t say this explicitly in any of its materials, but it appears to be the law, and Independent Sector is trying to change it. Worth a word of warning!
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0 # Katie Kleinsasser 2015-01-15 10:06
In response to a member's question about the increase listed in the proposed Federal Budget, David Thompson, Vice President of Public Policy at the National Council of Nonprofits, told us this:

No change to the volunteer mileage rate. The “Consolidated and Further Continuing Appropriations Act, 2015,” was signed by President Obama in December. That law funds all of the federal government through 9/30/2015 except the Department of Homeland Security. The DHS funding bill is tied up in the immigration debate. The IRS has the power to adjust the standard business mileage rate, and it does so every year. The volunteer mileage rate is fixed in statute and requires action by Congress to change it. More information can be found here:
http://new.councilofnonprofits.org/trends-policy-issues/volunteer-mileage
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0 # Jan Masaoka 2015-01-14 14:58
If a board member is serving as a volunteer, then he or she can only deduct un-reimbursed volunteer-relat ed expenses (such as mileage) at the volunteer rate.

A nonprofit can reimburse volunteers for expenses at the business rate, but if the expense is reimbursed, of course the volunteer can’t deduct it at all.

Also as a reminder, we’re not tax accountants and nonprofits generally shouldn’t give out tax advice . It’s best to encourage volunteers to speak with their own tax accountants.
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+1 # Julio Moran 2015-01-14 13:20
Does anyone know what the rule is for Board members attending Board meetings, especially those driving from outside the city? Can that be considered a business expense? We pay for air travel for those board members who live more than 300 miles away.
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