If you have considered donating your car to a charitable organization to get a tax write off, there are several major considerations that you should look at. First, you want to check out the charity. Secondly, you need to know the value of your car. Lastly, you need to see what responsibilities that you have as a car donor. A car donation tax deduction is a good thing to do and when down correctly, both the charity and the donor can benefit.
Once you have an interest in a particular charity, you need to make sure that they are a qualified organization. The IRS offers detailed information of what you must find out to determine if the organization meets the criteria. You can find that on the IRS website or by calling them at
877 829 5500.
Determining the value of your car donation tax deduction can also be tricky. You should look at the book value of the vehicle that you want to donate but use that as a guideline only. Most tax laws are based on "Fair Market Value" which can vary from car to car. A car in perfect shape with low mileage would likely sell for more money that one with a lot of body damage and a blown engine, and the IRS knows that too! Use Fair Market Value to determine your car donation tax deduction and consult the IRS or your state income tax department for detailed help or if you have any questions.
Lastly, you need to make sure that you have all your paperwork in order. You will need a statement from the charity that you made the donation that contains the name of the charity and a description of your car. You may also need additional information from the charity depending on your cars fair market value for your car donation tax deduction. You also need a separate statement that addresses whether or not you received anything in return from the charity and if so, what the value of those goods or services was.
If the fair market value of your car is over $500, there is additional tax paperwork that needs to be filed out and filed at tax time. In addition, if the value of the car that you donate is over $5,000, you must also submit a written appraisal that was done within 60 days of your donation. Be sure to check with the IRS as well as your state taxing authority for the most up to date rules, laws and requirements before making any car donation tax deduction.
Once you have an interest in a particular charity, you need to make sure that they are a qualified organization. The IRS offers detailed information of what you must find out to determine if the organization meets the criteria. You can find that on the IRS website or by calling them at
877 829 5500.
Determining the value of your car donation tax deduction can also be tricky. You should look at the book value of the vehicle that you want to donate but use that as a guideline only. Most tax laws are based on "Fair Market Value" which can vary from car to car. A car in perfect shape with low mileage would likely sell for more money that one with a lot of body damage and a blown engine, and the IRS knows that too! Use Fair Market Value to determine your car donation tax deduction and consult the IRS or your state income tax department for detailed help or if you have any questions.
Lastly, you need to make sure that you have all your paperwork in order. You will need a statement from the charity that you made the donation that contains the name of the charity and a description of your car. You may also need additional information from the charity depending on your cars fair market value for your car donation tax deduction. You also need a separate statement that addresses whether or not you received anything in return from the charity and if so, what the value of those goods or services was.
If the fair market value of your car is over $500, there is additional tax paperwork that needs to be filed out and filed at tax time. In addition, if the value of the car that you donate is over $5,000, you must also submit a written appraisal that was done within 60 days of your donation. Be sure to check with the IRS as well as your state taxing authority for the most up to date rules, laws and requirements before making any car donation tax deduction.
