Being a volunteer coach impacts the lives of the people you coach. You'll be happy to hear that you can receive a tax break for some of the costs you incur while volunteering in some circumstances. While your time is not deductible, you may be able to write off other unreimbursed expenses and lower your tax obligation if you itemize. However, the organization you volunteer for must be a qualifying 501(c)(3) nonprofit, tax-exempt organization as recognized by the IRS.
Potential Volunteer Coach Tax Deduction
A 501(c)(3) charity is a nonprofit organization that has been granted tax-exempt status by the IRS. All charities do not have tax-exempt status; any volunteer coaching expenses you incur with those organizations are not tax-deductible. For you to claim these expenses on your return, the organization you volunteer for cannot only be a charity, it must also have 501(c)(3) tax-exempt status. When you don't know the organization’s tax-exempt status, you can ask the group’s director for a copy of their 501(c)(3) determination letter and letter of affirmation, call the IRS Tax Exempt Customer Account Services line, or visit the IRS website and check the group’s status with an online search feature known as the Select Check tool.
IRS Publication 526, Charitable Contributions, lays the ground rules for all topics regarding volunteering, donations or other charitable contributions. Under the section, Contributions You Can Deduct, you will find a subsection entitled Out-of-Pocket Expenses in Giving Services. This part of IRS Publication 526 details how to determine what you can and cannot deduct as a volunteer coach. The IRS allows volunteers to claim many unreimbursed expenses, but there are clear rules in place that determine – and limit – how these expenses are claimed.
For example, you can deduct the actual cost of gas and oil required to get you to and from coaching or for any driving you do in the course of performing your volunteer duties. If you don’t want to figure the actual percentage of gas and oil you use, you can deduct at a standard charitable mileage rate. The purchase of equipment for any qualifying organization is also tax-deductible, as are the costs associated with buying and cleaning uniforms for you or your team. If you must buy and clean special football coaching supplies or volleyball coach attire you're unlikely to use elsewhere, this can be tax deductible.
Certain travel-related expenses are tax-deductible. However, only expenses directly tied to volunteering and not personal enjoyment can be claimed. Check the Out-of-Pocket Expenses in Giving Services subsection of IRS Publication 526 for more information regarding claiming travel expenses.
Exceptions and Limits on Deductions
The IRS places limits on the amount of the expenses you can claim for your volunteer coaching. For 2017, your charitable contributions may be limited if your adjusted gross income is more than $156,900 if you're married filing separately, $261,500 for single filers, $287,650 for head-of-household status, and $313,800 if you're married filing jointly or a qualifying widow or widower.
Typically you can write off certain contributions up to 50 percent of your adjusted gross income, but, as to be expected with Uncle Sam, some criteria and rules must be met. Depending on the type of contribution and to which organization it was made, you may be limited to 20 or 30 percent of your AGI. Also, you must claim the deductions in the year that the contributions were made. There are exceptions in which the IRS allows you to carry over contributions that exceed your AGI for a particular year and claim them in a subsequent year. See the subsection section entitled, Carryovers, under How to Figure Your Deduction When Limits Apply, in IRS Publication 526 for more information.
Changes Under 2018 Tax Law
You generally only claim charitable expenses if you itemize your deductions rather than take the standard deduction. The standard deduction is rising to $12,000 in 2018 for single people and $24,000 for married couples filing jointly, so some people may simply take that rather than summing up and documenting their charitable expenses.
Deductions Under 2017 Tax Law
As of 2017, the standard deduction is $6,350 for single people and $12,700 for married couples filing jointly, which may cause more people to itemize deductions for the 2017 tax year than in future years.
- IRS: EO Select Check
- IRS: Publication 526 Charitable Contributions – Out-of-Pocket Expenses in Giving Services
- LegalZoom: Charity Vs. 501(c)(3)
- Nolo: Can You Deduct Expenses of Volunteering for Charity?
- Forbes: New: IRS Announces 2018 Tax Rates, Standard Deductions, Exemption Amounts And More
- Forbes: IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts And More