Volunteer Driver Tax Appreciation Act of 2023
The legislation is expected to have a notable impact on tax deductions related to charitable work. By raising the charitable mileage rate, volunteers would be able to deduct a greater amount from their taxable income for travel expenses incurred while providing volunteer services. This could encourage more individuals to become involved in volunteer activities, ultimately benefiting community organizations reliant on volunteer efforts. if passed, it would apply to taxable years commencing after December 31, 2022, enabling volunteers to benefit from this adjustment fairly quickly.
SB3020, known as the Volunteer Driver Tax Appreciation Act of 2023, aims to amend the Internal Revenue Code of 1986 to increase the charitable mileage rate. Specifically, the bill proposes to equalize the mileage rate for charitable driving with the standard business travel mileage rate, which is recognized as a higher rate for tax deduction purposes. This change is intended to better compensate volunteers for their contributions, acknowledging the costs associated with travel when providing services for charitable organizations.
Notably, the bill has been introduced amidst ongoing debates about tax equity and the support of volunteerism in society. Proponents argue that the current mileage rate for charitable mileage has not kept pace with the rising costs of travel, ultimately disincentivizing volunteer work. Critics may raise concerns regarding the bill's fiscal implications, questioning whether increasing tax deductions for volunteer activity could lead to potential revenue losses for the government. Furthermore, there may be discussions on how to ensure that this benefit reaches those who genuinely contribute through volunteer work.