How To Donate

 How to get and give the most from your auto donation

 

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Dontating your car can make you feel good, too
Car donations help create a win-win situation

 

 

 

The IRS has revised the rules for taking a deduction as of January 1, 2005, if the value of the donated vehicle is over $500 and the item is sold by the charity, the deduction that the taxpayer can take is limited by the amount of money the charity actually receives from sale of the auto.

The charitable organization must also provide the donor with a letter of sale within 30 days of the sale stating the actual amount they received.

For example, you donate an auto to charity, and the value of that car is $2,000. The charity sells the car for $1,500. Your deduction will only be $1,500.

Here are some hints on how to get and give the most from your car donation:

  • An auto tends to sell better if it is clean. The charity may hire someone to clean the car if its not clean and that cost will be deducted from the actual value of the vehicle sale.

  • If there are minor things that need fixing, fix them. Changing light bulbs or gluing a mirrors and trim back on won’t cost you much to do, but it could reduce the sale price of your vehicle and your tax deduction if you don’t make these minor repairs.

  • Treat the auto as if you were going to try to sell it.  Of course you wouldn’t want to make any major repairs, it’s almost impossible to recoup those costs, but make the car, truck, van or RV look as appealing as possible.  Remember, you aren’t selling it, but someone is, try to help them out, it will get them more money, and get you a larger deduction.

  • If you wish to donate only to a specific charity, go for it!  However, you may want to research various charities to see if there are any fees associated with the donation or sale of your vehicle. Some charities may an outside company to sell any donated vehicles and those companies tend charge a commission which will get applied against the value of your vehicle and lower your deduction.

  • If you have a collector car, luxury car or custom car or hot rod, you may still donate it, but you must realize that you will only get a deduction for that value of the sale of the vehicle.  These types of vehicles tend to lend themselves to a specialty market, and may not fetch a favorable value at a charity auction.  Think long and hard before donating that ’57 Chevy or the Bentley that has just been kicking around.

 

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