While evaluating players at a recent tryout all of us coaches were talking between drills...The topic of taxes came up. Are the cost, such as travel, hotel, & food deductable for a travel coach who volunteers their time under an organizion that is currenlty a 501 3C organization? To a further extent is the equipment purchased also deductable?
Tax Deductable ????
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- May 25, 2010
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Different tax professionals will give you different answers and to top it all off, those answers can and do change from year-to-year.
Yes, this is a political statement about the over-complexity of our tax code which does nothing but keep creating government jobs that don't actually *produce* anything and which cost the rest of us countless hours of productivity.
In my interpretation, any contribution to a registered non-profit is tax deductible (up to the allowable limits, of course, which are somewhere around 30-50% of your income, depending on the type of NPO). There are many paid coaches (such as at a high school) claiming a deduction for coaching hours volunteered to non-profit leagues, given that their expertise has a measurable value.
However, although I am a small-business owner (thus my anger over the tax code!), I am not a tax professional and I would advise anyone to follow the recommendation of their accountant on this. Given what many of you spend annually, it's definitely worth seeking the deduction, even if you're required to itemize.
Yes, this is a political statement about the over-complexity of our tax code which does nothing but keep creating government jobs that don't actually *produce* anything and which cost the rest of us countless hours of productivity.
In my interpretation, any contribution to a registered non-profit is tax deductible (up to the allowable limits, of course, which are somewhere around 30-50% of your income, depending on the type of NPO). There are many paid coaches (such as at a high school) claiming a deduction for coaching hours volunteered to non-profit leagues, given that their expertise has a measurable value.
However, although I am a small-business owner (thus my anger over the tax code!), I am not a tax professional and I would advise anyone to follow the recommendation of their accountant on this. Given what many of you spend annually, it's definitely worth seeking the deduction, even if you're required to itemize.
The IRS guidelines are pretty clear on what is a deductible charitable donation.
Giving gifts of money, or donating items of value are deductible. Im not sure about donating your time , always under the impression you cannot. I go thru this with church stuff every yr and thats what I remember.
I doubt you can deduct your travel expenses while you donate your time either. You also cannot deduct anything which you benefit from.
But, you can definitely donate money to the 501C, which is deductible. And then 501c can pay for your travel expenses. That would be legit. You are not benefitting from that , it is a cost to the charityto support your volunteer work.. You cannot deduct a donation if you are paid, that is benefitting. Probably wrong but parents donate money to their kids organizations, and deduct it while benefitting from it all the time.
Bottom line is you can do anything you want until you get caught.
For any equipment to be deducted it must be paid for by the 501c. Unless you buy it and donate it to the 501c,then you may deduct that. It will go on the books of the 501C as an asset.
A 501c will usually have strict accounting and employ a CPA to handle all the money, in and out. They lay down the rules as to what is allowed and what is not. The 501c cannot spend money on frivolous things at whim either. For instance, it can pay for legitimate food, lodginig, while travelling, gas, etc. Dont expect it to pay for beer.
Not a tax advisor, but I did stay at a Holiday Inn express once.
Giving gifts of money, or donating items of value are deductible. Im not sure about donating your time , always under the impression you cannot. I go thru this with church stuff every yr and thats what I remember.
I doubt you can deduct your travel expenses while you donate your time either. You also cannot deduct anything which you benefit from.
But, you can definitely donate money to the 501C, which is deductible. And then 501c can pay for your travel expenses. That would be legit. You are not benefitting from that , it is a cost to the charityto support your volunteer work.. You cannot deduct a donation if you are paid, that is benefitting. Probably wrong but parents donate money to their kids organizations, and deduct it while benefitting from it all the time.
Bottom line is you can do anything you want until you get caught.
For any equipment to be deducted it must be paid for by the 501c. Unless you buy it and donate it to the 501c,then you may deduct that. It will go on the books of the 501C as an asset.
A 501c will usually have strict accounting and employ a CPA to handle all the money, in and out. They lay down the rules as to what is allowed and what is not. The 501c cannot spend money on frivolous things at whim either. For instance, it can pay for legitimate food, lodginig, while travelling, gas, etc. Dont expect it to pay for beer.
Not a tax advisor, but I did stay at a Holiday Inn express once.
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Greenmonsters
Wannabe Duck Boat Owner
Were your expenses tax deductible?
- May 25, 2010
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LOL
I had a brief phone convo about an unrelated matter with my accountant this morning and you're right about donations of time. The IRS interpretation is that if a person takes a deduction on time, it's the same as if he were receiving some payment. He's based in NJ and has heard of a couple of TB coaches who do claim a deduction, their justification (at least in their minds) being that they were supposed to receive a small stipend, but the organizations lacked sufficient funding to pay it. Interesting.
You're 100% right about equipment - it's a personal expense, unless it belongs to the organization. As for donations of goods and services, though (e.g. to support a fundraiser), the fair market value is tax-deductible. So, a landscaper could conceivably donate a free month of lawn service as a raffle prize and claim a deduction for it. BUT, if the prize is never claimed...then correct, the deduction should not be taken.
The meals deduction has never been reasonable. Travel in the service of a non-profit is treated the same as business travel, so you only get to claim 50% (the government's rationale being that 'you had to eat anyway'). So, either the organization has to pay the original tab or they have to reimburse you.
However, if the organization is paying coaches a per diem for expenses on travel dates, this is obviously different from a regular stipend, and that money would not be taxable, even if not all of it was used.
Confused yet? I would never agree with the IRS being clear about much, if anything. By keeping us confused, they keep themselves employed. The only thing I can say to an absolute degree of certainty is that gym memberships are not tax-deductible...unless you're a personal trainer and claim it as a business expense! Oy.
I would be afraid to actually attempt to calculate the costs of my 3 DDs playing and my coaching (Jr. High and TB) teams for past 8 years. Would probably force me to quit - nah. If I calculated and included my time lost at work - oh my goodness! I wish I could deduct half of the time spent reading this forum. Money is just numbers on a piece of paper - just keep paying and playing.
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I'm pretty confident sponsorship of a team is tax deductible. Some small patch on the uniform, or logo'd equipment bags, a banner hung on the dugout wall would suffice. Then the team can use that money to purchase equipment and pay expenses to away games. This is not a charitable contribution but a marketing expense.
- Oct 19, 2009
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We ran into this last year, summer ball team, we had a large donation from a coperation and they would not donate unless we had a Tax ID number. The coach did not want to get into getting a Tax ID so we did not get the money.
SoftScodad
SoftScodad if you run for office let me know I want to vote for ya!!!!!!!!
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- May 25, 2010
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Oh, man, that sucks. I will say that getting a tax ID number (TIN) is actually the one thing that the IRS makes very simple. As I recall (and I could probably look this up in 15 seconds), there's just a one-page form to fill out and you get the number almost immediately. I could be wrong about this, but I think we submitted an electronic form while at the bank and got the number right there on the spot. Now, you'd have to have the organization set up as a business entity (even a DBA is sufficient), but the county filing and banking setup wouldn't take more than a few hours, in most places...well worth it to be able to increase your donor pool.
Thanks...I think. LOL!
Without getting into too much political discourse here - is there an 'anything goes' section on the site?? - all our lives would be simpler, happier, and far more productive if we didn't have to waste so much time figuring out what to claim, what not to claim, etc. Hell, even that question alone is too convoluted to put into words. I'm a huge consumption tax proponent, but most Americans have been tricked into thinking that's a bad thing and that government *should* have complete control over all our money..
...much like those idiots who feel that a government - either elected or selected - should be able to dictate where you can and cannot play sports in school.
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