taxes

Volunteer vacations let you help others

"Volunteers welcome" sign and hands holding a plant
Highlights
  • Tax write-offs for these excursions resemble deductible business expenses.
  • To be IRS-sanctioned, charity work must be the focus of the entire trip.
  • Get documentation to help ensure you get the full tax break you're allowed.

Don't give up your vacation because the idea of being unproductive for a week or two drives you crazy. Take a "volunteer vacation" by helping a nonprofit.

Not only will you accomplish things during your time off; Uncle Sam could help pay for some of your modified holiday in the form of tax breaks.

Also referred to as "voluntourism," volunteer vacations allow you to help others within the United States and globally. Some volunteers provide cleanup after disasters. Others participate in ongoing programs, such as community building or teaching.

However you choose to volunteer while on vacation, if you want to get any tax benefits, you need to follow the IRS rules.

First, as with any charitable contribution, your gift of service must be made to a qualified organization. You also must itemize to claim the deduction.

And while many expenses can count toward your deduction, your time is not one of them. You cannot write off the value of your services. If you are a carpenter and spend a week working at a tornado-ravaged school, you cannot claim the income you would have received if you'd done the same work for a commercial client.

However, there are plenty of other volunteer-associated costs that the IRS will accept.

Tally your travel

Actual expenses to get to the volunteer site can be deducted. "This would be your airfare, parking at the airport, the rental car," says Larry Zimbler, an enrolled agent with 4Square Tax & Accounting in Fenton, Mich.

If you drive rather than fly, you can deduct actual costs, such as gas and maintenance, related to your volunteer services. Or you can claim the standard charitable deduction rate of 14 cents per mile. Whichever vehicular accounting system you use, you still can deduct parking fees and tolls.

Your lodging costs for the time you volunteer away from home also count.

If you're a veteran business traveler, this all sounds very familiar. "It works very much like a business trip," says Zimbler.

The main tax deduction rule for business travelers also applies here: Document every expense.

Make sure it's not for you

Carefully tracking how you spend your vacation time in service to others also can be very helpful. The reason? The IRS demands that the activity be done for the benefit of the authorized organization, not for your personal enjoyment.

 

advertisement

That doesn't mean you can't take pleasure in helping out. That is, after all, one of the reasons you decided to take a volunteer vacation. But the IRS frowns upon vacationers who throw in a few do-good days and try to write off the whole holiday.

"You have to consider the relationship between the work you do for charity and the time off," says Zimbler. "It's not going to be one of those situations where you can split the time. The entire trip is taken as a whole. If there's a substantial element of pleasure in the trip as a whole, you won't get anything."

Show Bankrate's community sharing policy
          Connect with us
advertisement
MORTGAGE HOME EQUITY AUTO CDs CREDIT CARDS
Product Rate Change Last week
30 year fixed, 0 point 4.28%  0.13 4.41%
15 year fixed, 0 point 3.30%  0.03 3.33%
5/1 ARM 3.30%  0.04 3.34%
 
View Rates in your area Search
Product Rate Change Last week
30K FICO-based HELOC 4.74%  0.01 4.75%
50K FICO-based HELOC 4.53%  0.02 4.51%
100K FICO-based HELOC 4.26%  0.02 4.24%
 
View Rates in your area Search
Product Rate Change Last week
60 month used car loan 2.86% --0.00 2.86%
48 month used car loan 2.79% --0.00 2.79%
60 month new car loan 2.94% --0.00 2.94%
 
View Rates in your area Search
Product Rate Change Last week
1 Year CD 0.90%  0.01 0.89%
2 Year CD 1.03%  0.02 1.01%
5 Year CD 1.59% --0.00 1.59%
 
View Rates in your area Search
Product Rate Change Last week
Balance Transfer Cards 15.67%  0.04 15.71%
Cash Back Cards 16.32%  0.04 16.36%
Low Interest Cards 10.91% --0.00 10.91%
 
Search
DAILY TAX TIP NEWSLETTER

Get expert advice during tax season on tax preparation and tips for cutting your tax bill.

advertisement

Connect with us