UPDATED: This text, first published in 2011, was updated Feb. 6, 2018, with 2017 tax season info. This includes a complete refresh and an accuracy review by Eagle Scout Michael B. Carr, CPA. (Thanks, Michael!)
DISCLAIMER: While this text was reviewed by a CPA, this material is intended for informational purposes only. It is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Always consult your own tax, legal and accounting advisors before engaging in any transaction.
When Baden-Powell said “Be Prepared,” I’m pretty sure he wasn’t talking about income tax returns.
But still, there’s no better advice than that two-word phrase during tax time.
Scouters who heeded the Scout Motto last year remembered to track and document their Boy Scouts of America-related expenses. And now, they know that they can include those expenses if they plan to itemize their deductions.
But what if you didn’t know that BSA expenses were deductible? Or what if your “filing system” is really your glove compartment that’s stuffed with gas receipts and crumpled-up napkins? And what qualifies as an eligible expense, anyway?
Your fellow Scouters and I are here to help. Along with other Scout leaders on Facebook, I’ve collected some tips to help you track and deduct your BSA-related expenses.
And with the April 17, 2018, deadline approaching fast, there’s no better time than now to get started.
General facts you need to know
Further clarification for this section comes from the Taxwise Giving newsletter (November 2016 edition).
- On IRS Form 1040, “2017 Instructions for Schedule A”, the Boy Scouts of America is listed by name on page A-9 as a “qualified charitable organization,” so BSA expenses are eligible.
- Four types of contributions can be deducted:
- Cash/check donations
- Property donations
- “Out-of-pocket expenses you paid to do volunteer work”
- Uniforms for leaders. “Uniforms that aren’t suitable for everyday use and that you wear while performing donated services for a charitable organization are charitable items in the year purchased,” Carr says. “Scout uniforms for leaders qualify.”
- The cost of driving to and from BSA events
- Some types of relevant contributions cannot be deducted:
- The value of your time
- Scouting dues or membership fees
- A contribution to a specific individual. This includes giving to the Boy Scouts and specifying a particular person or Scout as the beneficiary of your donation.
- IRS Publication 526 has lots more info (thanks, William)
Easy enough, right? Scouters will mainly be concerned with that third type of eligible deductions, “out-of-pocket expenses you paid to do volunteer work.”
Some items that you purchase to benefit your unit can be deducted, provided your unit didn’t reimburse you for them. You’ll want to check with your tax professional to be sure, but Scouters have told me they deduct merit badge pamphlets, den meeting activity kits, Wood Badge course fees and much more — again, as long as their pack or troop didn’t reimburse them.
However, there’s one expense that I’m certain you can deduct: the cost of driving to and from BSA events.
How to include driving expenses
Included in the third category is driving to or from a BSA event. Here’s what the IRS says about mileage:
- First, you’re eligible to deduct the cost of driving to and from the volunteer work, which would include most BSA activities.
- You have two options here:
- You can take the actual cost of gas and oil, OR
- You can take 14 cents a mile (note: the 2017 rate for volunteer work mileage remains at 14 cents a mile)
- You can deduct parking and tolls, so add that to the amount you claim under either method above.
- As a reminder, you cannot deduct any expenses, mileage included, that were repaid to you by your unit, district, council or anyone else.
- You also cannot deduct insurance or depreciation on the car.
Traveling as a volunteer
If you travel as a volunteer and must be away from home overnight, reasonable payments for meals and lodgings, as well as your transportation costs (previous section), are deductible. Also deductible: your transportation costs (air, rail and bus tickets, or mileage as described in the previous section).
This is where it gets tricky. You can’t deduct travel expenses if there’s a “significant element of personal pleasure, recreation or vacation.” But enjoying your volunteer time doesn’t rule out a deduction.
For example, if you’re an on-duty troop leader who takes Scouts on a BSA camping trip, you may deduct those travel expenses even if you had a good time.
Next, there’s the tricky part of “gifts from which you receive benefit.” Let’s say, for example, that you attend your council’s annual dinner. Can you deduct that expense? Sort of.
Here’s what the IRS says: “If you made a gift and received a benefit in return, such as food, entertainment, or merchandise, you can generally only deduct the amount that is more than the value of the benefit.”
So if tickets for the council dinner were $75 and the value of the dinner was $35, you can only deduct $40.
Or if you paid $110 for a $100 gift card at a silent auction, you can only deduct $10.
Also, you’ll want to consult a tax professional or the IRS site for individual gifts of $250 or more. There are special rules that apply to those larger gifts.
How to deduct gifts of more than $250
Here’s what Carr says:
If the leader is deducting more than $250 in a single charitable contribution, he or she should maintain a record of these expenses (credit card receipts for travel, copy of a cancelled check for cash donations), as well a letter from the charitable organization showing:
- Donee’s name
- Contribution date
- Contribution amount
- Indication the donee received no goods or services were in return for the gift.
How tax law changes will affect Scouters
The threshold for itemizing (filling out the Schedule A) will increase from $12,700 for a married-filing-jointly (MFJ) return in tax year 2017 to $24,000 for an MFJ return in tax year 2018.
As a result, a lot of the detailed tracking Scout leaders may have done in the past for charitable givings will no longer be necessary in 2018.
Unless charitable givings, mortgage interest, and state and local tax deductions are greater than $24,000 (MFJ) or $12,000 (Single), a Scout leader won’t be itemizing, and as a result the charitable donation won’t be deductible.
Ten tips for keeping track of it all
Here are 10 tips your fellow Scouters offered:
- Theresa W. keeps a “notebook in the car for tracking mileage! Man, it adds up faster than you think!”
- “I update an Excel Spreadsheet with costs, and a folder for receipts,” says Jeff B. “I print out the Excel table when I do my taxes.”
- Jamie D. also has a high-tech approach: “I use Mint.com to track all our expenses. I set up a category just for Scouts.”
- So does Tom H.: “I have a program called NeatReceipts that comes with a scanner. I use it for my expense reports for work. Just drop the receipts in the scanner then catagorize them. Set up a group for Scouting and everything is there at tax time.”
- But Michelle H. prefers the low-tech method: “We have a calendar and a folder (calendar stays in the folder) to keep track of everything!”
- Patricia L. makes it easy on her accountant: “I keep a file and drop my charitable receipts in it all year. Our accountant appreciated copies of online maps that we used for driving directions. Date, purpose, and mileage all in one place.”
- Julus P. doesn’t itemize, but he might start some day. “Scouting is not for profit, and not a hobby. Granted, it feels like a hobby sometimes! I don’t keep track of all these things but really should!”
- For Mark F., it’s not worth the trouble. “I don’t keep up with it. I enjoy being a Cubmaster and camp promotions chair, and so far, it’s cheaper than going to NASCAR races and cheaper than maintaining my boat and related gear I use for fishing!”
- Shawna R. keeps track of mileage, but not for every trip: “I don’t keep track of mileage for going to the store to pick up Scout items, even if it’s the only thing I’m going to the store for.” That’s probably a good call.
- And finally, please remember to heed the advice of Ann O.: “Check with your tax person on what you can deduct. It wasn’t as straightforward as I thought, and the rules seem to change.”
Want even more tips? Find them in the comments section below, and please share your own.
Oh, and good luck!