If you volunteer as a soccer coach, you may be eligible to claim a tax deduction to offset your expenses.
Expense Reimbursements or Stipends
The first thing to watch out for is whether the club reimburses your expenses or gives you a stipend for coaching. As a general rule, if your club pays you, no matter how poorly, you need to file taxes as a paid soccer coach.
If you want to avoid having taxable income, you should make sure your club is reimbursing specific expenses rather than just paying you a set amount. You'll generally need to provide a receipt for each expense (and keep your own copy).
The club should also have a documented policy on how it reimburses expenses. You want it to be clear to the IRS that you're not getting paid for services.
Expenses You Can Deduct
In order to deduct expenses, you generally need to be coaching for a qualifying 501(c)(3) non-profit organization. Your expenses are considered contributions to the 501(c)(3) organization, so that’s why your organization has to be a qualifying non-profit for you to be able to deduct expenses.
Most established youth soccer leagues and clubs are qualifying non-profit organizations. Some smaller organizations never officially become non-profits, and you generally can't deduct expenses for coaching there. If you volunteer coach for a for-profit organization, you also generally can't deduct those expenses.
In addition, you can only deduct expenses beyond any benefits you receive. For example, if coaching gets you $200 off your child's registration fee, you have to subtract $200 from your expenses.
You can generally deduct expenses like equipment, team registration fees, and communication software apps that are for the team or club as a whole. You can also usually deduct the costs you cover for other families who can't afford them.
You generally can't deduct your child's expenses or your child's share of team expenses. However, if you have to pay an extra expense because you're a coach, such as a volunteer background check fee, you can usually deduct that.
Mileage can also be deductible at the IRS rate of 14 cents per mile for volunteer work. However, like other expenses, the trips generally can't include trips you'd already be taking with your child. Deductible trips can include things like driving for a team you don't have a child on or traveling to a coaching clinic.
For all expenses, keep a log showing:
- The non-profit organization the expense was for
- Who benefited (individual player, team, entire club, etc.)
- Who kept any items you purchased (i.e., do you keep the equipment at home or did you give it to the club to permanently keep at their facilities?)
- The amount paid
- The date of the transaction
And of course, save your receipts.