10 Steps On How To Donate Your Car To The Right Charity And Get The Extra Tax Right Off You Have Been Looking For.
10 Steps To Donate Car To Charity
1) Make sure that if you are donating your car to a charity that they accept car donations because many of the smaller ones are not equipped to accept such large ticket items.
2) Keep in mind that the amount the organization gives the charity may not qualify you for a tax refund. Say for example the middlemen gives the charity only $100 for your car, or even $1000 for all cars turned in that month, that could mean you are not eligible for a tax write off.
3) Finding and picking the right charity means doing some research and Charity Navigator does a great job looking at many different charities that accept car donations. The website even shows how much each charity spends on administrative costs so you can make sure your donation will make a difference.
4) Keeping that last point in mind, always look at how much money will actually go to the charity, because many times the middle person will take as much as 50-90% of the sales price which doesn’t leave much for the charity.
5) Make sure that the charity you are donating your car to is a 501(c)(3). Basically it means they are registered with the IRS as a non-profit organization. For information on the status of any charity you are considering visit the IRS website and search for publication 78 at www.irs.gov. Typing 78 into the search field can also help you find more non-profit organizations.
6) You can increase the amount that goes to the charity by driving it to the donation center yourself. Usually charities have to pay for someone to go out and tow it to their donation center, but if your automobile still runs find out where the charity is and drive it on over.
7) Always ask for a receipt from the charity stating how much your car was actually sold for at auction if you feel the car was worth more than $500. The IRS is watching this closer now because many people gave themselves a higher tax write off thinking their car was worth more than $500. If the car was worth less than $500 than you can always use the FMV (Fair Market Value) from the Kelly Blue Book, but you should still always get a receipt from the charity.
8) There is a special form that needs to be submitted with your taxes if the car was sold for more than $500 which is called IRS Form 8283. You can also find this form on the IRS website listed above.
9) Never ever leave the space blank on the title change form when transferring the title to the charity. You could be liable if the title is still in your name and a person gets a ticket or your car is involved in a crime. Make sure you find another charity to donate your car to if they ask you to keep the space blank.
10)Keep a good paper trail of the donated car. Pictures of the car, copies of the title change, proof of the donation and a receipt from the charity. All of these things will help you in the event that the IRS audits you for your donation. Plus this may be one of the biggest donations you give in your lifetime and you want to make sure you get the most out of it for yourself and the charity.
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