How to Donate Your Car for Money

A car donation could be the single biggest donation you will make in your entire life. This gives you reason to ensure that you use it for the best charitable benefit. You can donate your car for money even though if its engine cannot start but the requirement is that it must be in a towing condition. Donating the car to a charity can help you to get more values compared to trading in for a new vehicle at the dealer.

It is best to only donate to a charity that you are familiar and you must know the type of charitable works that are doing. If you are not familiar with the charity, it is best to not donate your car to it. Often, the charity that is mentioned in the newspaper will look like a local charity but you won’t know if the charity is actually located in a state that is far away from your state. So, you should take action to check out the charity right now if you don’t know the charity but finds that it is an interesting charity that you want to donate your car to.
A few years ago, there is only a small number of charities that would accept car donations. Nowadays, you will find almost all charities accept car donations. This may be due to the competition of charity donation from an increasing number of charity organizations. You must know how to differentiate between a real charity and fundraising company that help their clients which consists of several charity organizations to donate the car. It is not recommended to donate your car to such company because they will only give the remaining of what is left of the proceeds after deducting the profits and expenses.

In order for your car donation gift to be qualified for tax exemption, you should check with the IRS Publication 78. alternatively, you can request for a tax exempt determination letter from the charity organization as proof for the tax exempt status. However, if you plan to donate your car to the church, you don’t have to include the tax exempt status determination letter. You would still get some tax deduction for donating the car to the church.

You can get a tax deduction of the fair market value, which is the estimate amount you will get if you are to sell it to a dealer. On the other hand, if the car is badly damaged, chances are you won’t get much deductibles from donating the car. You should obtain an outside appraisal if you want to prove that your car has a value of at least $5,000. to prove that you donate a car as a charitable gift, you must properly have the car title transferred to the charity organization.

You want to check whether the charity is registered and regulated by the government. To get the most out of the tax deduction, you should snap a few photos of the car with your camera. You should also keep a record of the value estimates of vehicles that are similar to the donated vehicle.

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