Tips for Donating Vehicles to Charity
Since this may or may not be the first time that you are donating your car or vehicle to charity, there are some things to keep in mind.
- If you want to donate to a local charity, look under "social and human services" of your Yellow Pages.
- Make sure you ask how the charity will be using the money it raises.
- It is the donor, not the charity, who is obligated to value the car and will pay any penalties if an IRS challenge finds your figure to be inaccurate.
- If the car is worth more than $5000, an independent appraisal will be necessary
If the car is worth less than $5000, the donor should use the Kelley
Blue Book to determine the market value (or any other book similar).
You can find instructions regarding the Kelley Blue Book on the Fair
Market Value page.- Make sure the charity is eligible to receive tax deductible contributions. Ask for a copy for your personal records of the organization's IRS letter of determination which verifies its tax exempt status.
- Make sure to get a receipt for your donation, which should include:
- The charity's name
- Its federal tax ID number
- The donor's name
- The date of the donation
- The year, make, and model of the donated vehicle
- Don't be fooled by charity names that look familiar. Check to make sure they are the real thing.
- You will need to itemize your deductions on your federal and state income tax returns.
To make sure you are donating to a charity that is eligible for tax-deductions, you can reference the Internal Revenue Service's site at www.irs.com which has information about many charities.
You can also check out the Better Business Bureau. They have a huge list of charities which have been rated, and several other helpful tips.