Car Donations

The Importance of Donation

Donations are an extremely important need in our entire world, no matter which charitable organization you decide to give. Donations are important to any charity because it goes to help further research, help victims of different diseases, disasters, or poverty, and gives you the ability to feel good about helping out your fellow neighbor. Without donations, we would not be able to fund research on various diseases, we would not be able to give clothing to families in need, we would not be able to put food on the table of the hungry, or help the poor pay for medical supplies.

What is a Car Donation?

A car donation is the act of donating your car for the good of a charity. All proceeds from the sale of that car would go towards whatever benefits from that specific charity. Many different charities accept car donations to help with their cause. If you have a vehicle that is sitting in your yard or driveway just taking up space, you may consider this a waste of space, so why not consider donating the car to charity. While the car may be useless to you today, it could very well mean food for the poor tomorrow.

How does it work?

Well when you decide to donate your car, you would first need to contact the charity and make certain they accept car donations. If they do accept vehicle donations, they would send you a few documents that you would need to fill out and return to them, along with the title of the car. The charity would then arrange to have your car picked up from your location and towed to theirs; the towing is usually free of charge. After the sale of the vehicle (either from their own lot or from an auction service), they would send you a statement containing the dollar amount the car sold for. This statement is what you use when you go to file for income taxes.

Car Donation U.S. Tax Benefits

Within the U.S., those who donate cars have the ability to claim the donation as a tax deduction. The IRS and government define exactly how you can claim that donation. If your vehicle sold for less than $500 with the charity, the IRS allows you to make your own estimate (based on fair market value) and claim any amount up to $500. For any car that sells for greater than $500, you can only claim the actual value of the sale.

Things to Check when Donating a Car

There are a few things you should prior to donating your car, to avoid any problems down the road.

1. Determine the Fair Market Value of the Car – Make sure you determine what the car is worth, prior to donating to charity. It is important you avoid the blue book value, unless the car is in perfect, mint condition inside and out. The fair market value of your car is the only amount you can claim when you do your taxes.
2. Choose a Reputable Charity – Ensure that the charity you are intending to donate is a non-profit organization and a reputable one at that. Avoid charity scams and if the organization is not non-profit, you will not be able to claim the donation as a deduction during tax time.
3. Ensure that you Receive All Necessary Documentation – It is important that you receive and keep all receipts and such from your donation. If you have claimed your car has a value of more than $5,000, you will need to provide the IRS with a written assessment that states that specific value.

We hope this information on car donations has helped you and will provide with the guidance you need to donate your car to charity.