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Overview
Donating cars to charity has become a common fundraising strategy for many nonprofit organizations. Without spending any money, the donor can get rid of an older or malfunctioning car and also get to deduct its value from his taxes. The nonprofit organization takes care of the rest and, for its trouble, gets to keep the proceeds. It is a win-win for everyone involved.
History
The National Kidney Foundation has benefited from the donation of more than 650,000 cars over a 25-year period. This has resulted in more than $150 million in revenues to their organization. Their success in fundraising significant amounts has motivated other charities to copy this strategy.
Benefits
Donating a car to charity benefits the donor as much as it does the nonprofit organization. Not only is this a way to support a cause that is important to you, it gives you a tax deduction. You don't have to find a buyer. You don't have to handle the paperwork involved in selling or junking the car, and, in many cases, your car gets picked up and towed away for free.
Connsiderations
The tax deduction is permissible when the charity to which you donate your car is designated by the Internal Revenue Service as a tax-exempt, 501(c)(3) organization. You can assign a value of $500 or less to your donated car on a fill-in-the-blank gift receipt, which you should receive from the charity. If your car is worth more than $500, you should make sure to document its Blue Book value and keep a picture and copies of all paperwork so that you can prove the amount you claim on your taxes. If the car you donate is worth more than $5,000, you must provide the IRS with an independent professional appraisal in order to take the deduction.
Features
Churches, charities that assist the homeless and charities that help find missing persons are among the hundreds which include the option of donating a car as one of their giving choices. Many of these charities will also accept donated trucks, vans, recreational vehicles, boats and trailers. Some will even take donations of real estate. Organizations such as Donate Car USA function as middlemen to connect people who have a car to donate with a charity that reflects their values and priorities. This organization retains half of the amount that they realize from the sale of the car. The rest is given to the donor-designated charity. The average donated car sells for $400, so the charity gets about $200 for each car.
Potential
Other charities, such as the Good News Garage in Burlington, Vt., repair usable cars. This Lutheran charity provides cars for low-income single women who would otherwise have no reliable way to travel to work. The organization also helps the women keep their cars in working order. The organization, which has been operating since 1996, relies on donated cars which they pick up from designated locations all over New England. People can also arrange to donate a car to the Good News Garage online. (See the link below.)
