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May 27, 2014

Q&A: Tax Deductible Mission Trips

Can individuals who go on mission trips deduct their expenses?

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Q: For my church's short-term mission trips, participants give the church money for a special fund that's used to pay their trip expenses (airfare, lodging, and so on). Some participants believe the money they spend for a trip is tax deductible and should be listed on their contribution statements. A mission organization I contacted agrees with this thinking. My understanding, though, is that only funds for a ministry and not for an individual are deductible. Who is correct?

A: I will defer to the guidance I offer on charitable contributions and mission trips in chapter 8 of the 2014 Church & Clergy Tax Guide. Based on your description, I believe this scenario from the guide most closely resembles your situation:

Participants: Adults

Who pays travel expenses (transportation, lodging, meals): Church

Does the church receive designated contributions from participants or others? Yes, from participants, in the amount of their travel expenses paid by the church.

Tax consequences (assume that the trip was preauthorized by the church board or membership and furthers the church's exempt purpose):

  • Payments by participants to their church are deductible as charitable contributions if the trip involves "no significant element of personal pleasure, recreation, or vacation."

  • Participants' payments can be reported by the church treasurer on giving statements (if expenses are $250 or more, the church's receipt must comply with substantiation requirements described in this chapter).

For further details on how trips should be authorized, and how the IRS defines "personal pleasure, recreation, or vacation," I would encourage you to acquire a copy of the tax guide.

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Related Tags: charitable contributions, giving, mission trip, receipts, tax

Comments

Our questions have less to do with the charitable contribution credit issued for contributions by the participants themselves on a short-term mission trip, and more to do with contributions made by others to send a particular individual on a short-term mission trip. How should such contributions be viewed, and what is the appropriate tax treatment?

If the church gives each adult going on a short term mission trip to another state, should the adults furnish receipts for the money spent? Also, if the amount advanced is not all spent should the individuals return the unspent money? If they do not (some are on payroll and some are not) do they get a 1099/have it added to their W2 at the end of the year?

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