Thinking of making a car donation to your favorite charity, but don’t know how to go about doing it? This article will tell you the basics of the process so that you get a tax deduction while helping others in need.
Most of the well-known charities have some sort of car donation program in place. However, if you want to be sure you can get your tax deduction, you need to do a little research first. Qualified organizations are defined in IRS Publication 526. Information about specific charities that qualify is outlined in IRS Publication 78. You should check out these government publications if you have any questions before you donate your vehicle.
Next, you will need to gather certain information before you begin the donation process such as the year, make, model, approximate mileage, vehicle identification number (VIN) and overall condition of your car. You also must have an original title to the vehicle and make sure that it is in your name and clear from any liens on it. Armed with these basics, you are ready to donate your car.
Tax laws determine how much you are allowed to deduct for the donation. Simply put, if the charity to which you donate the vehicle, sells the vehicle for more than $500, and uses the proceeds from the sale to help their mission, you may deduct the sales amount for the vehicle. If, however, the charity gives the vehicle to a recipient to use as its means of helping that individual, or the vehicle sells for less than $500, you may deduct the fair market value of the vehicle.
Among the best known car donation programs run by the charities themselves are the following:
1. The National Kidney Foundation – Call 1-800-488-CARS
2. The Salvation Army – Call 1-877-SA3-AUTO and you can make arrangements for your vehicle to be picked up at no charge to you, or to drop it off at a Salvation Army location near you.
3. The Breast Cancer Society – Call 1-866-923-7512
4. Easter Seals – Call 1-888-631-6833 or go to their website
Car Donation Programs accept vehicle donations, sell the cars, and then give a percentage of the proceeds to a charity. In this kind of donation, you would be able to deduct the sales amount only.
One of the programs that gives a donated vehicle directly to a needy recipient is 1-800-Charity-Cars. You can call them at 1-800-242-7489. If your vehicle meets their established criteria, it will be given directly to an individual or non-profit organization. If not, it will be sold and the proceeds will be used for their charitable missions.
Another option to donate your car is to contact the local charity of your choice directly and find out if they accept vehicle donations and their process. Be sure to find out how they will use the donation, and the process they use to provide you with the certification needed for your tax deduction.
Donating your car to charity is one way that you and the charity can both come out winners.