Maryland Volunteer Deductions

• When it comes to claiming a state income tax deduction in Maryland for the expenses you incur to volunteer, the state follows the federal tax rules. Like many other states, Maryland bases much of the information you report on your state taxes on the figures you report on your federal tax return. As a result, claiming a volunteer deduction in Maryland is only available if you take a deduction for it on your federal return. Therefore, you should prepare your federal 1040 form prior to filling out your state taxes.
  
  

IRS Eligible Charities

• Before you choose a charity to volunteer for, the first thing you should do is find a charity that is eligible to receive tax deductible donations. The IRS provides tax-exempt status to nonprofit organizations that operate for the sole benefit of the community by promoting religious, educational, scientific, humanitarian, literary or charitable causes. If an organization doesn't satisfy these requirements, you cannot claim a deduction for your volunteer work. However, certain religious organizations, such as churches, can accept tax-deductible donations even though the federal government doesn't require them to obtain official tax-exempt status.
  
  

What to Deduct

• When calculating your charitable deduction, you can never increase it by the value of the time you spend volunteering, even if you are providing the same services that you perform in your profession. The charitable deduction is typically available for property and cash donations you make. However, the IRS does allow you to claim the deduction for the out-of-pocket expenses you incur solely as a result of volunteering. For example, if the charity asks you to use a car as part of your service commitment, you can deduct the gas and oil you pay for. To do this, the IRS provides a special standard mileage rate that you multiply by the annual miles you drive when volunteering. In addition, you can deduct the cost of uniforms if the charity requires you to wear one, such as with candy stripers who volunteer in a hospital.
  
  

Reporting Your Volunteering

• In order to deduct your volunteer expenses, you must elect to itemize your deductions on Schedule A instead of claiming the standard deduction. Generally, you will want to itemize when the total of your deductible expenses exceeds the standard deduction you are eligible for. When you fill out your Maryland state income tax return, the form allows you to include all of the federal deductions you claim on Schedule A, except for the state income taxes you pay to Maryland during the year.