We are in a very, very rural area. The closest Walmart is about 30 miles away . . . on curvy, country roads! The closest big city is about 60 miles away. Many times our volunteers need to drive to the city to get items needed for the PTO. We use the internet and mail order as much as possible, but you can't get everything you need in the mail.
We asked our Assistant Principal about the PTO reimbursing volunteers for gasoline when they are making a trip just for PTO business. We were told that legally we couldn't do this because of our tax exempt status. He said a volunteer is a volunteer which means that everything they do should be strictly without charge or reimbursement.
Ok. The hundreds of hours we give, the constant trips back and forth to school, the printer paper and ink cartridges we use for PTO business, the long distance phone calls we make . . . all I want in return for this is to benefit the children at my school. But with gas prices at $1.50+ per gallon, and a round trip to the city at 120+ miles, is it too much to ask to be reimbursed gas expense? Many of our volunteers are able to volunteer because they don't work a full time job . . . which means they usually don't have a lot of extra money anyway.
Does anyone know if it is illegal for a non-profit organization to reimburse for this type of expense?
Don't know the legalities of reimbursing for gasoline or mileage, however . . . during one of my girl scout training sessions in a previous lifetime I was told that all mileage for GS purposes (i.e. - trips to purchase items, mileage to/from meetings, campouts, etc.) should be logged and you could put those under "tax deductions" on your federal income taxes at the IRS prevailing rate for mileage (I think now 33 cents per mile or something along those lines.)
Not a lawyer, but I believe it is legal to reimburse for mileage. I don't see any reason why it wouldn't be. Non-profits (this refers to formally designated 501(c)(3)s, by the way) can do all kinds of big things. They can have employees, pension plans, etc., etc.
In fact, I believe that -- if mileage isn't reimbursed -- a volunteer could take a tax deduction for mileage driven on behalf of a nonprofit.
Nonprofit does not mean that group has to operate like a lemonade stand at a yard sale. It just refers to where any excess moneys go (toward the cause).
All that said, I have not run across many/any groups that reimburse for mileage. I wouldn't have a problem with it, if there was some exceptional trip made on behalf of the parent group. I wouldn't reimburse for driving to and from meetings down the street, but....
Nutshell: I believe your asst. principal is wrong in his legal assessment.
What are the standard mileage rates for 1999, 2000, and 2001?
For 1/1/99 - 3/31/99 and for 2000, the standard mileage rate is 32.5 cents a mile for all business miles. For 4/1/99 - 12/31/99 the rate is 31 cents per mile. The rate for moving or medical reasons is 10 cents a mile. The rate for travel for charitable volunteer work is 14 cents a mile.
For 2001, the standard mileage rate for all business miles is increased to 34.5 cents per mile per Revenue Procedure 2000-48. The standard mileage rate for moving or medical reasons is increased to 12 cents a mile. The rate for travel for charitable volunteer work remains at 14 cents a mile.
For more information, refer to Tax Topic 510, Business Use of Car, and Publication 463, Travel, Entertainment, and Gift Expenses.
We have a budget amount for long distance calls with our PTA group for the President, although, no one in recent years has asked to be reimbursed. This was put in because our regional phone call bills are high. I don't see a difference with mileage reimbursement.