Minnesota Legislature amends tax law for volunteer driver reimbursement

A new legislative proposal, Senate Bill 3189, introduced on April 1, 2025, aims to enhance the financial support for volunteer drivers in Minnesota by increasing the tax subtraction for mileage reimbursements. This bill, championed by Senators Nelson and Putnam, seeks to recognize the invaluable contributions of individuals who provide transportation services to charitable organizations.

The primary provision of the bill amends Minnesota Statutes to allow taxpayers to subtract the amount of mileage reimbursement received from charitable organizations for their volunteer driving activities. Specifically, the subtraction will apply to reimbursements that exceed a set threshold, ensuring that volunteers are compensated fairly for their service while also encouraging more residents to participate in volunteer driving.

This initiative addresses a growing concern about the financial burden faced by volunteer drivers, who often incur significant costs while providing essential transportation services to those in need. By increasing the allowable tax subtraction, the bill aims to alleviate some of these costs, making it easier for more individuals to engage in volunteer work.

While the bill has garnered support from various community organizations advocating for volunteerism, it has also sparked discussions about its potential impact on state revenue. Critics argue that increasing tax subtractions could lead to a decrease in tax income, which may affect funding for other public services. Proponents, however, emphasize the social benefits of supporting volunteerism, suggesting that the long-term community gains could outweigh the initial financial concerns.

The bill is set to take effect for taxable years beginning after December 31, 2024, should it pass through the legislative process. As discussions continue, the outcome of Senate Bill 3189 could significantly influence the landscape of volunteerism in Minnesota, encouraging more residents to step forward and contribute to their communities while receiving necessary financial support.