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Committee hears bill to revise tax subtraction for volunteer drivers; $2-per-mile formula proposed
Summary
Senators heard testimony on SF 3189 to change the individual income-tax subtraction available to volunteer drivers. The proposal would set a $2-per-mile subtraction minus any reimbursement paid by the charitable organization; the Department estimate shows a modest revenue impact.
The Senate Taxes Committee on April 8 considered Senate File 3189, a bill that would change the tax subtraction available to volunteer drivers who provide rides for nonprofit or transportation programs. Sponsor Senator Karin Nelson said the bill would adopt a simple subtraction formula: $2 per volunteer mile minus any mileage reimbursement paid by the organization.
"This would keep more money, provide a greater subtraction for the volunteer drivers," Senator Nelson said. She walked the committee through an example: if a charitable organization reimburses a driver at $0.60 per mile, under current law the subtraction (the difference between reimbursement and the federal charitable mileage rate of $0.14) would yield $0.46 per mile; under the proposal the subtraction would be $2.00 minus $0.60, or $1.40 per mile.
Supporters said the change would help sustain volunteer-driver programs that provide medical and mobility rides in rural areas. Nelson said statewide programs logged millions of volunteer miles and tens of thousands of trips annually and that the proposed formula would help offset nonreimbursed "empty" or no-load miles.
The fiscal note attached to the proposal estimates about $100,000 of annual state revenue impact. Nelson also noted an outstanding policy question: whether the $2-per-mile subtraction could inadvertently cause volunteer drivers to be classified as "for-hire" drivers under other regulatory rules; sponsors said they were working to confirm that would not occur.
The committee laid the bill over for further consideration.
Why it matters
Volunteer drivers provide essential transportation in many rural areas where transit is unavailable. Proponents said a clear, flat subtraction would reduce out-of-pocket costs and help retain volunteers, while the state revenue impact is modest.
What’s next
Sponsors will continue to seek assurances that the change would not reclassify volunteers as for-hire drivers and will provide any necessary clarifying language to the committee.
