Deducting Miles Driven on profit of a Charity

A taxpayer may usually deduct 14 cents per mile for all miles driven on profit of a charity (Section 170(i)). The original purpose of the travel must be to conduce to the mission of the charity. In addition, the travel must not supply the taxpayer with any considerable number of personal pleasure, recreation, or vacation (Section 170(j)). Further, a taxpayer may not deduct the miles driven on profit of a charity, other than a church, if the purpose of the travel is to sway legislation (Section 170(f)(6)).

For example, if a taxpayer drove her personal automobile a total of 500 miles to secure and distribute wheelchairs on profit of a excellent charitable organization such as LifeNets http://www.lifenets.org/, the taxpayer could deduct .00 (500 miles x 14 cents per mile). However, if a scoutmaster took a troop of Boy Scouts to summer camp and spent a week there with them, the scoutmaster may not deduct the miles because the trip to the summer camp has a considerable element of personal pleasure, recreation, or vacation.

For miles for miles driven for relief efforts connected to Hurricane Katrina after August 25, 2005, through December 31, 2006, a taxpayer may deduct 70 percent of the acceptable mileage rate in succeed for enterprise miles. If a taxpayer receives a repayment from a charity for miles driven for relief efforts connected to Hurricane Katrina after August 25, 2005, through December 31, 2006, the taxpayer may exclude the repayment from gross revenue up to 100 percent of the acceptable mileage rate for enterprise miles.

The acceptable mileage rate for enterprise miles was 40.5 cents per mile from August 25, 2005, through August 31, 2005. The acceptable mileage rate for enterprise miles increased to 48.5 cents per mile from September 1, 2005, through December 31, 2005. The acceptable mileage rate for enterprise miles driven in 2006 is 44.5 cents per mile (Rev. Proc. 2005-78).

If a taxpayer does not receive any repayment from a charity for miles driven for relief efforts connected to Hurricane Katrina, the taxpayer may deduct 29 cents per mile for miles driven from August 25, 2005, through August 31, 2005; 34 cents per mile for miles driven from September 1, 2005, through December 31, 2005; and 32 cents per mile for miles driven in 2006 (Rev. Proc. 2005-78).

If a taxpayer receives repayment from a charity for miles driven for relief efforts connected to Hurricane Katrina, the taxpayer may exclude from gross revenue up to 40.5 cents per mile for miles driven from August 25, 2005, through August 31, 2005; 48.5 cents per mile for miles driven from September 1, 2005, through December 31, 2005; and 44.5 cents per mile for miles driven in 2006 (Rev. Proc. 2005-78).

In addition to the acceptable mileage rate, a taxpayer may deduct the cost of parking fees and tolls incurred while driving an automobile on profit of a excellent charitable organization (Rev. Proc. 2005-78).

If a taxpayer has any doubt about the status of an organization as a excellent charity, the taxpayer may consult Irs Publication 78 at the Irs Web site: http://www.irs.gov/

A taxpayer claims the deduction for miles driven on profit of a charity on program A of Form 1040. The deduction for miles driven on profit of a charity is included with the amounts for cash contributions on the same line of program A of Form 1040.

A taxpayer should have good records such as a mileage log to document the deduction. The burden of proof is on the taxpayer to prove the number of all deductions claimed.

If the taxpayer's total itemized deductions do not exceed the acceptable deduction amount, the taxpayer will usually not receive any benefit from the deduction for miles driven on profit of a charity.

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