Congress Considers Giving Volunteers More Money for Mileage Expenses

June 23, 2008

Congress Considers Giving Volunteers More Money for Mileage Expenses

Congress is considering legislation that would increase the tax deduction for people who use their automobiles as part of their volunteer work for charities.

Under federal law, volunteers who drive their cars for charitable purposes may be reimbursed up to 14 cents per mile without the payments being subject to federal income tax.

Some members of Congress say that rate is too low, particularly as gas prices have reached more than $4 per gallon.

Bills pending in Congress would increase the reimbursement to reflect the business mileage rate, which was raised this week to 58.5 cents per mile.

Sen. Russell D. Feingold, a Wisconsin Democrat, is sponsoring a Senate bill that would increase the reimbursement. Rep. Todd Russell Platts, a Pennsylvania Republican, has introduced legislation in the House.

Both lawmakers have introduced similar bills in the past, with no success.

But with costs for energy rising quickly, Senator Feingold said volunteers should be entitled to a larger reimbursement.

“By increasing the amount of reimbursable mileage, we can make it easier for volunteers to continue helping these organizations provide important services to their communities without having to worry about the impact it will have on their wallets,” Sen. Feingold said in a written statement.

The reimbursement rate for volunteers has not changed since 1997 — though volunteers who used their cars, trucks, and other vehicles for the Hurricane Katrina relief efforts were able to receive the standard business mileage rate from August 25, 2005 though December 31, 2006.

The Joint Committee on Taxation estimates the government would lose $2-million in revenue from 2008 through 2012 if Congress increases the mileage rate for volunteers.

— Peter Panepento

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