Deducting Dependent's Habitat for Humanity Expenses

A charitable contribution is a charitable contribution. I can't see any reason why it depends who gives the money.

The payments aren't going to the charitable organization. Therefore they are not charitable contributions. They only become deductible if the person making the payment incurs the expense while providing services to the organization.

Ira Smilovitz

Oh, but the payments ARE going to the charitable organization. Take a look:

The whole thing looks rather odd to me, but I think the idea is that it's supposed to work because the trip is not conditional on someone making the payments. Habitat has a very good reputation, don't ever recally them getting into trouble about dodgy donations.

I assumed the costs were being paid directly by the parent and not through Habitat for Humanity. So my argument is moot. However, I guess you didn't read the disclaimer on that page:

Tax Deductibility Funding raised toward the cost of a Global Village trip also includes the cost of food, lodging and transportation during the trip. Only a portion of the required trip payment supports the charitable purpose of the hosting Habitat program. Depending on the participant's country of origin, this trip's cost may or may not be tax-deductible. Please consult a tax adviser concerning your specific situation.

They are making no claim that the costs ARE deductible, just that they may be. US Tax Court decisions have determined that in this situation they are not.

Ira Smilovitz

The issue in this post isn't whether contributions to Habit for Hummanity are deductible. They are.

The issue isn't whether the costs would be deductible if the taxpayer provided services to Habit. They would be.

The issue is whether his child's expenses are deductible as his charitable contributions. They aren't. That issue was decided by the US Supreme Court in a similar case regarding costs of a taxpayer's son doing mission work for the Church of Latter Day Saints. The Supreme Court held they were not deductible because the taxpayer's were not performing the services, their son was. In this post, the poster is not performing the services, his daughter is.

In that case were the payments made directly to the church, with the church then paying the costs?

They were not paid to the Church. The link to the case is in my first post above. It refers to the funds transferred by petitioners "to their sons" and notes they were not donated "for the use of" the Church.

The question from the original post doesn't say whether the funds were paid to Habitat for his daughter's expesnes, or paid by Dad to his daughter for her use in providing the service. However, I'm not convinced that it matters. It's not a gift/Charitable Contribution if it is made with the strings attached that it can only be used by one person.

In the Habitat for Humanities situation, based on the link provided by John, the payments are made directly to HH.

People make restricted gifts to charities all the time, and they are normally deductible. As long as the use is within the exempt purpose of the organization, and nobody gets a personal benefit from it, I don't see that it should be problem.

Checking with this IRS page:

Told us that she qualified as our dependent for 2015 and probably will be one for 2016 as well.

She just signed up to take part in a ten day Habitat for Humanity home building project in Paraguay this Fall. Checking showed us that her airfare, hotel costs, meals, taxis and a few other expenses made during the Habitat trip are deductible as charitable contributions providing she works 8 hours a day building that home while she's there.

My question is, if we pay those expenses for her, will they qualify as charitable contributions for us in 2016? =========== No deduction. Why? Not same taxpayer.

These expenses will exceed $250, and out-of-pocket expenses that exceed the threshold need a letter form the charity confirming receipt. Any such letter will be in the dependent's name, not the parents. This means it is her deduction, and such is not transferrable to her parents. Her parents may also have gifted her the funds.

No, but the parent is making the contribution directly to the nonprofit. The nonprofit is using its discretion to use that gift to support its exempt purpose: to send a volunteer to Paraguay.

The gift was from the parent - there's no reason the letter shouldn't go to the parent.