When you book your air tickets through flyer programs, you get certain free miles. If you are someone who uses these flyer programs quite often, the free miles are accumulated over time. You can convert these miles to cash or donate it to charities. Being said that, many of us are concerned about the rate of tax deduction on donated airline miles. The question is, can one get tax deduction on his donated airline miles? This article will shed some light on this.
Donating the unused miles to charities is a good way to support them because it does not burden you financially. You are utilizing your unused benefits for a good cause. The charitable agencies can covert these unused miles to cash later on or help their inhabitants. Many charitable trusts use the free miles for the medical treatments for their children or elderly.
Tax deduction on donated airline miles
Each country has different criteria for tax deduction on donations made to charities. In America, the donations made to charities are tax-deductable. However, it is not applicable to the free airline miles you donate. In the opinion of law experts, one does not have true ownership over his/her accumulated air miles in contrast to the money or things they have.
The airline miles are offered to a customer as a perk. They are meant to appreciate them for choosing the particular flyer program and to encourage them to use the same in future. Technically speaking, it is a loyalty program and the customer cannot claim complete ownership over it because the provider of these benefits can withdraw them at any time. Therefore, you do not have to worry about any tax deduction on donations you make using your free miles.
A recent blog post from the International Red Cross indicates that companies or persons cannot claim any tax deduction on their donation of airline miles to charities. IRS further defines donation of airline miles as gifts.
You can also covert your airline miles to cash and donate the amount to the charities. This is a good option when for those planning to help several charity organizations. The bottom line, free airline miles are gifted to you. It is your choice to make use of it; either by converting these miles to cash or donating it for a good cause.