|
A search on "donating a vehicle" yielded plenty of details on this charitable act. The process seems simple enough, but it will require a little paperwork at tax time. Tom and Ray of public radio's "Car Talk" devote a whole section of their web site to donating cars to charity. They sum up the process as: "You fill out a form, you get a call or an email back, and then your car gets picked up." The main requirement is that you have a clear title to the vehicle, and it is lien-free. Most charitable organizations that accept cars will pick up the vehicle from you, and many don't care if the car is in working condition. Do make sure that
the Internal Revenue Service (IRS) classifies the group as a 501(c) (3) organization -- otherwise, your donation can't be deducted from your taxes. Ask to see the group's IRS Determination Letter for proof that it's a qualified nonprofit group. After your car is picked up, the charity will give you a receipt that you'll need for tax purposes. The tricky part comes when you file your taxes. You have to determine the value of your donation yourself. The IRS publication 561, "Determining the Value of Donated Property" (PDF), outlines how to price your donation. It's common to consult a guide such as the Kelley Blue Book when estimating a
used car's worth. Make sure to carefully evaluate the condition of your car too. If your car is worth more than $5,000, you need to get a qualified written appraisal before donating it. In order to get a tax deduction, you have to itemize your taxes. Depending on your tax bracket and number of deductions, you might not get enough of a tax break from donating your car to make it worthwhile. You may want to consult with a tax advisor before making a donation. Of, if you're an altruistic person, you can always donate a vehicle and not worry about the taxes. Some groups use donated cars as part of their charitable activities, and others sell the cars and use the profits to fund their activities.
|
