Car Donation Checklist
12:44 AM // 0 comments // Sajib Barua // Category: //By Christine Jackson
You've most likely seen ads on tv soliciting car donations for charities. Giving your car to charity provides numerous advantages for both the charity and its clients - and for you. The charity will get a valuable asset, which they can either use, or sell to benefit their programs. You get a deduction in your tax return that could be equal to the current market value of the car, or the amount that the charity gets when they sell the car. Based on the car, that could really be worth more than the amount a car vendor will provide you with on it as a trade-in, and it's almost certainly more than a scrap dealer will provide you with for the metal.In the event you do decide to donate your car to a charity, it's essential for you to do some research and to keep careful records to ensure that you and the charity get the full worth of your donation.
Here's a checklist of things you need to know and do before you donate your car.
Know the Charity
Numerous charities no longer take direct car donations because they do not have the resources to take full benefit of them. Some bigger charities take direct donations and also have a whole department dedicated to dealing with the paperwork along with other requirements. Many other charities take car donations by means of third-party donation centers that serve as clearinghouses. Before you donate your car, check to make sure the charity is a 501 (c) 3 qualified charity. If it is not a 501 (c) 3 organization, you won't be able to deduct your donation from your taxes.
Transfer the Title of the Car To the Charity And Keep A Duplicate Of The Transfer Papers For Your Records
Some less-than-reputable companies will ask you to let them deal with the details of the transfer of title. This could be easier for the charity, which never really takes possession of the car. They don't actually transfer the title till the car is sold to another party, but this can result in problems for you when you file your taxes. Instead, ensure the title of the car is transferred to the charity so that you will have a record of the donation.
Inquire the Charity How They'll Gain From Your Donation
Charities use donated cars in several different ways, and there are variations in the tax treatment amongst the ways. It's essential for you to know whether the charity will use the car itself, donate it to a needy family or sell the car at auction. It's also important for you to know if the charity can make significant repairs to the automobile before selling it. Again, there are variations in tax treatment.
Take Pictures Of The Car and Get an Appraisal of its Value If The Car is Worth More than $5,000
Before you make a donation, establish its value. If it's worth more than $5,000, you need to get a professional appraisal to be sure you will be able to deduct the most value out of your taxes. If its worth is less than $5,000, you can generally establish its value by checking Kelly Blue Book or current, local classified ads for similar autos in similar condition.As soon as you have assured yourself that the charity is reputable and that you simply know the rough value of your car, call a charity that accepts car donations and find out about their procedure.
Here's a checklist of things you need to know and do before you donate your car.
Know the Charity
Numerous charities no longer take direct car donations because they do not have the resources to take full benefit of them. Some bigger charities take direct donations and also have a whole department dedicated to dealing with the paperwork along with other requirements. Many other charities take car donations by means of third-party donation centers that serve as clearinghouses. Before you donate your car, check to make sure the charity is a 501 (c) 3 qualified charity. If it is not a 501 (c) 3 organization, you won't be able to deduct your donation from your taxes.
Transfer the Title of the Car To the Charity And Keep A Duplicate Of The Transfer Papers For Your Records
Some less-than-reputable companies will ask you to let them deal with the details of the transfer of title. This could be easier for the charity, which never really takes possession of the car. They don't actually transfer the title till the car is sold to another party, but this can result in problems for you when you file your taxes. Instead, ensure the title of the car is transferred to the charity so that you will have a record of the donation.
Inquire the Charity How They'll Gain From Your Donation
Charities use donated cars in several different ways, and there are variations in the tax treatment amongst the ways. It's essential for you to know whether the charity will use the car itself, donate it to a needy family or sell the car at auction. It's also important for you to know if the charity can make significant repairs to the automobile before selling it. Again, there are variations in tax treatment.
Take Pictures Of The Car and Get an Appraisal of its Value If The Car is Worth More than $5,000
Before you make a donation, establish its value. If it's worth more than $5,000, you need to get a professional appraisal to be sure you will be able to deduct the most value out of your taxes. If its worth is less than $5,000, you can generally establish its value by checking Kelly Blue Book or current, local classified ads for similar autos in similar condition.As soon as you have assured yourself that the charity is reputable and that you simply know the rough value of your car, call a charity that accepts car donations and find out about their procedure.
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