Hello and thank you for your question. You deserve much credit for
doing this sort of volunteer work.
The expenses that you describe can qualify for the US income tax
charitable deduction, but there are a couple of hurdles that must be
crossed.
First, you cannot take a charitable deduction for any sort of
contribution to a *foreign* charity. So to qualify, the entity that
you are volunteering for must be a U.S. charity:
"Qualified charitable contributions generally do not include amounts
paid for the benefit of foreign charitable organizations unless a U.S.
organization transfers funds to the foreign charity and the U.S.
organization controls the use of the funds, or the foreign
organization is only an administrative arm of the U.S. organization.
Certain Canadian charities may also qualify."
CPA Journal, May 1999
http://www.nysscpa.org/cpajournal/1999/0599/departments/fedtax.html
If you are providing these charitable services to an American
organization like Habitat for Humanity, the charitable deduction is
available as described below (the travel cost will be the cost of the
plane ticket, not the cents-per-mile standard that applies to miles
driven):
"Popular organizations such as Global Volunteers, Habitat for
Humanity, and the Earthwatch Institute send people around the country
and the world to build houses, tutor people in languages, and watch
whales. To participate, you usually pay a deductible donation to the
organization. You're often responsible for your travel expenses, which
can also count as a charitable donation if you spend most of your time
working on the project, says Owens, former director of the IRS's
Exempt Organizations Division. He recommends getting a letter from the
organization verifying your expenses and identifying the skills you
used while abroad.
"You can deduct your travel costs, including mileage ... and your
meals, but strict rules cover these situations. The legal standard is
that you have "no significant element of pleasure, recreation, or
vacation." You can, of course, have fun while you are volunteering,
but you can't add extra stops or days to your trip without
jeopardizing your tax write-off. If you work at a volunteer site for
five days, and then spend the weekend sight-seeing, that's okay. But
if you go to Turkey for an archaeological dig, and then stop for a
week in Paris on the way back, you may have killed your deduction,
says Owens."
Tax-Smart Travel
http://www.aaa-calif.com/westways/0702/money.asp
And second, you can only take a charitable deduction if you (and your
spouse if you file a joint return) have sufficient income and other
deductions that you itemize your deductions, rather than taking the
standard deduction:
"Approximately two-thirds of all tax filers are non-itemizers, and
thus are not allowed to claim tax deductions for their charitable
contributions."
Charitable Contribution Deduction for Non-Itemizers
http://www.case.org/govtrelations/taxpolicy/nonitemizers.cfm
But if you are volunteering for a US organization, and if you are
itemizing your deductions, then the deduction is available to you.
Search terms used:
income tax charitable deduction "foreign charity"
"habitat for humanity" expenses "tax deduction"
"charitable deduction" itemize standard
If any of this is unclear, feel free to request clarification. I
would appreciate it if you would hold off on rating my answer until I
have an opportunity to reply.
Best of luck
richard-ga |
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