SECTION 4. PROCEDURE

.01 The federal income tax deductibility of unreimbursed expenses of a federal advisory committee member under § 162 or 170 depends in part on whether the committee member reasonably expects to receive substantial benefit or commensurate financial return as a result of incurring the expenses. Determining expected benefit or financial return often can be difficult when the committee member is engaged in a trade or business related to the subjects discussed by a federal advisory committee while performing services without compensation for that committee.

.02 Therefore, if a taxpayer incurs an unreimbursed travel or other out-ofpocket expense while performing services without compensation as a member of a federal advisory committee, the Service will not challenge the taxpayer’s deduction of the expense as a charitable contribution under § 170, provided the taxpayer satisfies the requirements of that section other than those relating to the expectation of any benefit or financial return. If a taxpayer incurs an unreimbursed travel or other out-of-pocket expense while performing services without compensation as a member of a federal advisory committee and the expense is reasonably related to the taxpayer’s trade or business, the Service will not challenge the taxpayer’s deduction of the expense as an ordinary and necessary business expense under § 162, provided the taxpayer satisfies the requirements of that section other than those relating to the expectation of any benefit or financial return.