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PROPOSED CHARITABLE DRIVING TAX RELIEF ACT

  Print Version

By Kara Clark, CPA Staff Accountant

Representative Thomas Petri introduced a bill on March 15, 2013, known as H.R. 1212: Charitable Driving Tax Relief Act of 2013 which would amend the Internal Revenue Code of 1986, allowing reimbursements for the costs of using passenger automobiles for the performance of charitable work to be excluded from an individual's gross income. The bill also proposes to eliminate the requirements by charities for reporting mileage reimbursements to the Internal Revenue Service, thus reducing the paperwork for not-for-profit organizations.

This bill has been referred to the Committee on Way and Means. The odds of it passing the committee stage and moving on to the House of Representatives (House) and then to the Senate are slim, as this is a reintroduction of a 2011 bill that never made it to the House.

Currently, the IRS standard mile rate is 56.5 cents for business, 24 cents for medical and moving, and 14 cents for charity volunteer driving. The 14 cents is written in the Internal Revenue Code and lacks language suggesting it be adjusted for inflation, thus it has not been changed in years.

However, a volunteer can currently deduct the actual costs of gasoline, oil, or parking fees and tolls associated with operating the car for volunteer purposes. Reliable records for this purpose must be maintained. An individual cannot deduct general repairs and maintenance expenses (including tire replacement), depreciation, registration fees, or insurance costs.

To read the full text of the bill, click here.

Sources:

http://philanthropy.com/article/House-Bill-Would-Improve-Tax/137979/

http://www.irs.gov/publications/p526/ar02.html#en_US_2012_publink1000229681

 

If you have any questions regarding the article above or any other issue affecting your not-for-profit organization please contact your Blue & Co. advisor or e-mail us at blue@blueandco.com or call us at 800-717-BLUE

 

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CIRCULAR 230 DISCLOSURE: To ensure compliance with recently-enacted U.S. Treasury Department Regulations, we are now required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including any attachments, is not intended or written by us to be used, and cannot be used, by anyone for the purpose of avoiding federal tax penalties that may be imposed by the federal government or for promoting, marketing or recommending to another party any tax-related matters addressed herein.


 

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