Expenses of Unpaid Elected Officials

[djack1040]

My small town elects a Mayor and City Council Members to unpaid positions.

Other than an occasional paid convention or seminar trip, the officials receive no compensation nor are they reimbursed for "employee business expenses".

Each has a fairly substantial expense for cell phone, mileage, and non-sponsored governmental workshops. None of them have a PAC to solicit political contributions.

Since they are not employees, I don't think a Form 2106 is appropriate.

Would their expenses be deductible as miscellaneous itemized deductions on Sch A subject to a 2% limit?

[Jim R]

Charity

Sounds like Out-of-Pocket expenses for charity TaxBook p 4-17

[Bees Knees]

Employee business expenses on Schedule A are for the ordinary and necessary expenses paid or incurred in carrying on a trade or business (Section 162). You can’t deduct expenses under Section 162 if you are not carrying on a trade or business.

Section 162 applies to all businesses, including the business of being an employee. Volunteer work where you do not get paid can be deductible as a charitable contribution, provided the organization you are volunteering for is a qualified charity.

Section 501(c)(1) lists corporations organized under an Act of Congress which is an instrumentality of the United States as being a qualified exempt organization, but I doubt that would include your local government. I don’t see anywhere where local governments that do not pay wages qualify as charities.

You also have the above the line deduction on line 24 of the 1040, but that is for fee-basis government officials. Again, they need to be compensated in order to deduct expenses.

I don’t see any place you can deduct the expenses.

[JG EA]

Sounds like Out-of-Pocket expenses for charity TaxBook p 4-17

Pub 526
Contributions You Cannot Deduct:
Contributions to Civic leagues and associations.Political organizations and candidates.

[Sam Slade]

Deductible Contribution

My small town elects a Mayor and City Council Members to unpaid positions.

Other than an occasional paid convention or seminar trip, the officials receive no compensation nor are they reimbursed for "employee business expenses".

Each has a fairly substantial expense for cell phone, mileage, and non-sponsored governmental workshops. None of them have a PAC to solicit political contributions.

Since they are not employees, I don't think a Form 2106 is appropriate.

Would their expenses be deductible as miscellaneous itemized deductions on Sch A subject to a 2% limit?

Money or property given to federal, state, and local governments is deductible if contributions are solely for public purposes. Thus, I believe if their expenses were paid from the town treasury and the unpaid elected officials reimbursed the expenses to the town treasury, then they would have a deductible charitable contribution.

[Sam Slade]

Update on Previous Response

My small town elects a Mayor and City Council Members to unpaid positions.

Other than an occasional paid convention or seminar trip, the officials receive no compensation nor are they reimbursed for "employee business expenses".

Each has a fairly substantial expense for cell phone, mileage, and non-sponsored governmental workshops. None of them have a PAC to solicit political contributions.

Since they are not employees, I don't think a Form 2106 is appropriate.

Would their expenses be deductible as miscellaneous itemized deductions on Sch A subject to a 2% limit?

Since there would be a direct link between contributions and reimbursements (reference my previous response) the contributions probably would have to be included in income. Thus, my proposal would not be a satisfactory solution.