Most of us know charitable contributions are (usually) an itemized deduction for income tax purposes. Less commonly known is that out-of-pocket costs may be deductible.

Unreimbursed expenses incurred that are incidental to volunteer work are deductible. Examples are transportation to the place where services are rendered, postage, stationary/supplies, phone calls, etc. Substantiating documentation is required such as credit card receipts and canceled checks.

If opting not to deduct actual expenses (such as parking/tolls or public transportation) then $0.14/mile driven is deductible. Note that insurance and depreciation are not deductible.

If travel requires being away from home overnight then reasonable payments for meals, lodging and transportation are deductible.

Unreimbursed expenses for personal property used while performing volunteer work (e.g. cost of printing pictures from a personal camera) are deductible. Again, insurance/depreciation is not deductible.

A volunteer who has unreimbursed expenditures of $250+ is treated as having obtained a receipt from the charity (and may deduct those expenses) if the volunteer has adequate records for his/her volunteer expenses (those generally required to substantiate deductions) and obtains an abbreviated receipt from the charity. The receipt must contain (1) a description of services rendered; (2) a statement whether the charity provided any goods or services in exchange for the unreimbursed expenses; (3) a description and good faith estimate of the value of any goods or services provided (if the goods or services provided consist of any intangible religious benefits the receipt must so state) and (4) the receipt must state whether any goods or services were provided.

Separate contributions that aggregate to $250+ do not meet the same substantiation requirements. Each individual contribution is treated separately and “stands alone” when meeting substantiation guidelines.

Travel expenses are not deductible if there’s a significant element of personal pleasure, recreation or vacation. It doesn’t mean one can’t enjoy volunteering. For example an on-duty troop leader for a tax-exempt youth group who takes children belonging to the group on a trip may deduct qualifying travel expenses even if he or she enjoys the trip, working with youth, etc.

The value of services is not deductible. For example suppose you are an attorney typically charging $200/hr. If donating 5 hours of your legal skill you may not deduct $1,000. The IRS allows deductions for “property” and services are not deemed such. Similarly use of one’s personal home for meetings is not a “property” contribution.

It’s important to note it’s up to the taxpayer to substantiate deductions if questioned by the IRS so he/she should be prepared to prove costs with documentation and show the connection between expenses and the volunteer work for which the deduction is claimed.