Introduction of the Charitable Driving Tax Relief Act of 2013by Former Representative Thomas E. Petri
Posted on 2013-03-15
in the house of representatives
Friday, March 15, 2013
Mr. PETRI. Mr. Speaker, today, I am introducing the Charitable
Driving Tax Relief Act of 2013 to remove a serious disincentive to
participation in charitable activities. Private charitable activity
plays an important role in our society, and it is important that
Congress not stand in the way by penalizing those who wish to offer
their services to these groups.
Under current law, individuals that volunteer their time and energy by driving their personal vehicles on behalf of a charitable group can end up with an unpleasant surprise in the form of an unanticipated tax bill. Specifically, volunteer drivers receiving reimbursement for the use of their vehicle are taxed on these payments to the extent that they exceed 14 cents per mile. This treatment stands in stark contrast to the allowance for reimbursement for the business use of that same vehicle, 56 and one-half cents per mile in 2013.
The Charitable Driving Tax Relief Act will equalize the tax treatment of charitable reimbursements with those received for business driving because the point of the payment is essentially the same, that is, to cover the cost of operating a personal vehicle while performing an important service in the pursuit of a greater good.
To achieve this end, my legislation would exclude from gross income any reimbursement received for the use of a volunteer's car while assisting a charitable group, limited only by the cap the Internal Revenue Service sets regarding business driving. This treatment would be available only for services provided without compensation and drivers would be required to maintain sufficient records to substantiate the charitable use of their vehicles. Finally, this bill drops the requirement that charitable groups report these reimbursements to the IRS, removing an administrative and paperwork burden that takes resources away from a charity's larger purpose.
Each day, thousands of Americans lend a hand in providing transportation services to a multitude of organizations engaged in good works. These activities include assisting individuals with their routine grocery shopping, providing the use of a four-wheel drive vehicle to transport home-visit nurses during inclement weather, delivering meals as part of a holiday food drive, helping individuals to keep their medical appointments, and many more similar activities.
These volunteer drivers are donating their time and their talents, not their vehicles, and accepting reimbursement for the use of that car, incidental to their time and talent donation, is a reasonable act, which should not result in an additional tax liability. Today, when it comes to driving a personal vehicle, our tax code makes a distinction between business and charitable uses. This distinction is a mistake; it is a serious disincentive to charitable activities, and it should be corrected. I encourage my colleagues to support the continued efforts of our charity-minded constituents by cosponsoring the Charitable Driving Tax Relief Act of 2013.