Tax Deductions for Being a Good Samaritan

Volunteer work is awesome. I never thought that I would enjoy volunteering as much as I do, but I do. Recently, someone I know informed me that you could deduct some of the funds that are involved in volunteerism and giving to charity.

I thought Angie was kidding, but she wasn’t! She then proceeded to tell me about the first year she saved all of her receipts from the stuff that she did and gave away. Now, I’m going to share it with you in hopes that you’ll be as enlightened as I was when she informed me of all this.

One of the things that both Angie and I want you to know is this: Don’t give because it gives you a good tax break. That’s never the right intention; sadly, some wealthy people and corporations use this strategy in order to get more and more tax breaks. It may be smart, but it also may weigh on your conscience.

Angie was involved in several different volunteer activities: She lead a small group of teenagers at her church, she chaperoned trips, gave students rides when they needed them. She tithed regularly, and she also gave larger sums of money to different organizations throughout the year. Every time that Angie donated money, she made sure to ask for a receipt.

Angie started to save her gas receipts, but only when she wasn’t reimbursed for driving. If you’re reimbursed, it’s not too fair (or legal) to ask to be reimbursed again (and that may be a premise for an audit later on, which would be more of a mess than it’s worth). She would get snacks and get supplies for her small group. And the receipts kept accumulating.

Angie also lost a significant amount of weight that year. So, she decided to donate some of her old clothes. The Salvation Army store helped her calculate an approximate value of her donation, and gave her a receipt for her donation so she could itemize that as well.

At the beginning of the next year, Angie sat down with all of the receipts and started calculating how much she may be able to deduct if she decided to itemize instead of taking the standard deduction ($5,700 at that point because Angie was single). It looked something similar to this (but not exactly; Angie couldn’t remember exact numbers in her head).

Gas costs (unreimbursed): $530
Supplies for small group: $102.54 (rounded up to $103)
Clothes Donation: $123
Tithe: $4,000
Donation to Organization A: $500
Donation to Organization B: $225
Donation to Organization C: $400

She told me her deduction was somewhere around $6000 if she itemized it. So, she took the time to do so, giving her an extra $300 worth of deductions for that year. She was excited, especially because she’d just gone into the next tax bracket. Angie shared that her return wasn’t that big that year, but had she not itemized, she may have even had to pay the IRS some taxes.

So, you can deduct a lot of your volunteer expenses and donations from your taxes. The IRS does it to encourage giving of time and treasures, but in this case, I think that everyone wins! Except maybe the IRS, since they had to pay Angie instead of her paying them.

The lesson? Don’t be afraid to see if you can deduct some things off of your taxes that you would do anyway. Don’t necessarily go out of your way to get a tax deduction via these means, but enjoy the experience and time as well.

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