April 24, 2015

Can I Deduct Travel Costs for a Mission Trip/Vacation?

Question:

How do I determine "significant personal time" when I am on a mission trip? Example: I travel overseas for a mission trip and work one week full-time for the mission. The next week, I explore and vacation in the area. As a charitable contribution, can I deduct any part of my airfare, lodging,  and food during the week I worked? Or have I lost the whole amount because I vacationed?

Answer:

Although the terms "significant personal time" in the question are not given specifically in IRS Publication 526, Charitable Contributions, the publication does describe when traveling costs are deductible for charitable purposes. Here is a quote from page 5 of the publication:
Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel.
However, the publication went on to say this:
The deduction for travel expenses will not be denied simply because you enjoy providing services to the charitable organization. Even if you enjoy the trip, you can take a charitable contribution deduction for your travel expenses if you are on duty in a genuine and substantial sense through the trip. However, if you have only nominal duties, or if for significant parts of the trip you do not have any duties (my emphasis), you cannot deduct your travel expenses.
So how does one determine if he or she had "significant parts of the trip" that were spent on personal pleasure? Well, Publication 526 does not give a black and white calculation. However, there are four example situations included in the publication that may help individuals work through the framework of the guideline. We encourage you to click on the link above and read each example.
 
In a quick search of tax resources, we found twenty four different court cases, IRS Revenue Rulings, and private letter rulings pertaining to this matter. Each situation portrayed a different answer depending on the facts and circumstances of each case. Individuals should contact their tax professional for guidance on this matter.

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