Donate Car Charity

If you’ve conducted a simple Google search on how to donate a car to charity you’ve no doubt come face to face with an overwhelming onslaught of companies offering to “help” you do it. But these companies are not charities themselves, and so the convenience they are offering is not free. Somebody, whether it’s you or the charity you’re donating to, is paying this intermediary for their services, and paying to make a donation to charity doesn’t make much sense. It’s certainly not what the IRS had in mind when they helped pass the law and released the helpful consumer publication: “A Donor’s Guide to Car Donations”.

The IRS guide lays out in very clear terms what to keep in mind if you want to donate a car to charity and receive the maximum tax write-off you have coming to you for your generosity. So to make sure that your generosity doesn’t get turned around on you or taken advantage of, take the time to familiarize yourself with the following facts about the charity car donation law straight from the source.

Investigate The Charity

Investigate the charity to which you’re thinking of donating your car. Not all charities accept car donations, and if you just lazily give your car away to the first charity that interests you without first checking to make sure they accept such donations, you could be wasting that charitable opportunity. Find a charity you like that does a lot of good work in your area, then drive your car to that charity and save them the expense of having someone come pick it up from you.

Confirm Your Tax Benefit

Verify that you will actually receive the full tax benefit for your donation to this entity. Be sure first that the charity you donate your car to is a 501 © (3) organization, as there are many groups that can legitimately claim non-profit status, but not all of them can get you a full (or any) tax deduction for your donation. For example, political lobbying organizations are usually non-profit, but they most claim 501 © (4) status, which is not eligible for charity car donation tax credit.

Find Out The Value Of Your Car

Research on your own the current Fair Market Value (FMV) of your car. Don’t let someone else tell you the value of your car; you tell them. Find out the Fair Market Value of your car (not just the Kelly Blue Book value). Be honest in your assessment of the car’s condition, however. Not only would that be falsifying information submitted to the IRS, but ethically it could be said that such an act might taint the charity of one’s donation.

Be Aware Of Your Legal Responsibilities As A Donor

Learn what responsibilities are incumbent upon you, the one making the charity car donation so it doesn’t get you into trouble later. The IRS keeps close tabs (read: audit) on these donations of cars to charity. So be sure that your kindness doesn’t turn around to bite you in the hand. Don’t let a charity talk you into leaving assignment of ownership blank on the donation paperwork. This is convenient for them because it saves them from re-titling the car, but it keeps the responsibility on you should anything happen with that car (such as a traffic accident or a crime) even though the vehicle is no longer in your possession.

Also, if the car you donate is valued at $500 or more be certain to complete IRS Form 8283 and attach it to that year’s taxes. The full value of your donation won’t be determined until the charity sale of your donated car is complete.

For-profit intermediary companies don’t do anything for you that you can’t do yourself with a little legwork. And most of the time, the money they’re taking from the donation isn’t coming out of your pocket or your write-off but out of the pocket of the charity itself. When you donate a car to charity, let the charity you support receive the full benefit of your support, and keep the middlemen out of it.