Announcement

Collapse
No announcement yet.

Unconfigured Ad Widget

Collapse

Guide To Donating Your Car

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Guide To Donating Your Car

    Guide To Donating Your Car

    You Don't Have to Write a Check to Help

    Print SHARE Share on facebookShare on twitterShare on linkedinMore Sharing Services
    At Charity Navigator, our primary purpose is helping America's donors make informed giving decisions when they part with their hard-earned dollars by writing a check to charity. In recent years, however, more and more donors are attempting to help themselves, and help others, by donating their used automobiles to charity. This has become a massive business. In the year 2000, nearly ¾'s of a million people took a car donation deduction on their federal tax returns, thusly lowering their taxes by over $650 million.

    As America's car donation system is currently construed, it is easy for donors to benefit greatly by donating their cars, albeit with a little risk. By following these 10 Charity Navigator Tips For Charitable Auto Donations, you can minimize that risk, and maximize the amount that actually gets to charity.

    1. Find a Charity That Directly Accepts Car Donations
    If at all possible, avoid the for-profit intermediary organizations that advertise so pervasively to handle your car donations. When you work with one of these organizations, they keep the vast majority of the dollars created from your donation. Even the most reputable of the agencies that handle these transactions keep nearly 50% of the car's value for their troubles (other, less scrupulous entities keep 90%, or even more). If you can find a charity that handles the transaction themselves, they can keep 100% of their profits. It's possible that the charities you already support have a car-donation program that you don't know about. Check with them first.

    2. If Your Charity Doesn't Accept Cars, Take the Time to Find a Charity That Does, and Still Does Work You Respect
    Remember that you're still making a charitable donation, and don't simply give your automobile away to any charity, just because they're a charity. Do a little research, and find a high-performing charity that does the kind of work you like, in the region you wish to target, and does that work well.

    3. If It Runs, Drive the Car to the Charity
    Worthy charities are going to have to pay someone else to handle a pick-up or a tow. This is yet another cost that cuts into the amount that gets to that organization's programs. If you can get the car to them yourself, do it.

    4. If You Have to Use a Intermediary Agency, Research the Percentage that Gets to Charity
    The IRS does not require the car donation agencies to contribute a set amount of the auto's proceeds to the intended charities; that amount is negotiated between the charities and the handlers. Try to find an agency that maximizes that amount, and call the charity to confirm that number before you give. The charities are reluctant to criticize the middlemen, because they don't want to lose the dollars they do receive, but state attorney generals are beginning to investigate and even prosecute these for-profit middlemen, for holding themselves out as charities and misleading the public on the amount that is actually reaching charitable causes.

    5. Make Sure Your Intended Organization is a 501 (c) (3)
    While many organizations can claim non-profit status, donations to 501 (c) (4) organizations are generally not tax-deductible. These are political organizations with permission to lobby our government; like Disabled American Veterans or the National Rifle Association. Make sure your intended recipient has 501 (c) (3) public charity status.

    6. Transfer the Car Correctly to the Charity
    Some charities will ask you to leave the assignment of ownership space on the charity donation papers blank, so they don't have to re-title the auto. If your charity asks this of you, find another charity. If you don't formally sign your car over to the designated nonprofit, you will be held responsible for any parking tickets that are subsequently incurred, or liable if it's used in a crime. Remember, the charity you give the car to will probably not use your car to deliver meals to the needy, but will simply sell it as quickly as possible. When someone buys it from them at auction and doesn't bother to register that car, it's still yours in the eyes of the law.

    7. Value Your Car Correctly
    With to the proliferation of car donations, the IRS became increasingly concerned about how taxpayers valued the vehicles they donated to charity. Not only did the agency increase heir audits in this area, but it also advocated for changes to the laws that govern such deductions. It succeeded with the passage of the American Jobs Creation Act of 2004 which prevented taxpayers from simply deducting the published fair market value of vehicles worth more than $500. Instead, the deduction is determined once a car is sold and the charity sends the donor a receipt indicating the exact amount the car garnered at auction.

    8. Complete Your Paperwork
    Non-cash donations are the most common triggers of audits, so it is imortant to keep thorough documentation of a car donation. Specifically, if your car is valued over $250, then you need to obtain and retain a written acknowledgement from the charity. Additionally, if your car is worth more than $500, you must complete section A of the IRS Form 8283 and attach it to your yearly taxes. Furthermore, if your car is worth over $5,000, then you must have an independent approaisal and fill out section B of IRS Form 8283.

    9. Use Fair Market Value (FMV) for the Car
    There are several exceptions which allow you to use the Kelley Blue Book or a NADA guide, but you must use the FMV, not simply the highest value listed for the year and make of your car. Use the FMV when:

    instead of selling the vehicle, the charity keeps and uses it,
    the charity makes improvements to the car before selling it,
    your car is sold at a discounted price to a person with a low income,
    or if the car is worth less than $500.
    Otherwise, you can only deduct the amount that the charity sells the car for at auction as indicated on the written receipt the charity sends you.

    10. Take the Time to Get It Right
    It is true that the biggest winner in the car donation game is usually the donor, and not the charity recipient. But if you take your time, ignore the quick and easy television appeals, and find a reputable, high-performing charity that will make the most of your donation, we can all emerge victorious.
    charitynavigator.org
    اللھم صلی علٰی محمد وعلٰی آل محمد کما صلیت علٰی ابراھیم وعلٰی آل ابراھیم انک حمید مجید۔
    اللھم بارک علٰی محمد وعلٰی آل محمد کما بارکت علٰی ابراھیم وعلٰی آل ابراھیم انک حمید مجید۔

Working...
X