Taxes can already be extremely confusing for freelancers but it gets even
Navigating the sea of taxes can already be extremely confusing but the water gets even murkier when it comes to pro bono work.
Maybe you agreed to do pro bono work for a charity’s website or maybe you decided to design the collateral for a local 5k.
Regardless of what pro bono work you do, it is still costing you time which is costing you money.
So, can you claim those hours as a deduction on your taxes? Unfortunately no, but you can still claim expenses as a direct result of the pro bono work.
In order to do that you must meet some pretty specific conditions.
“However, before you denounce all good deeds and curse the IRS, you may be able to claim “do-gooder” deductions.
These “do-gooder” deductions are certain qualifying expenses incurred while working pro bono for a qualified organization. For example:
- If you own a marketing business and you pay a sub-contractor $1,000 to create a website for a 501(c)3 non-profit organization as part of your pro bono services this represents a tangible expense that would qualify as a tax deduction.
- If you agree to provide and distribute yard signs for a charity event, the cost of the yard signs and your travel expenses for distributing them would be deductible on your tax return.
Essentially, you can claim direct expenses for the supplies and tangible items needed to complete the charitable work you are doing (a notable exclusion to this is office and other equipment unless you give it to the charity) and for indirect expenses such as travel.”
Find out more about claiming pro bono work deductions at Freelancers Union.