Car Donations for the Needy

The charities that accept donations will vary by state, but some suggestions include the Red Cross, American Wildlands, Easter Seals, animal shelters and animal rescue groups. Many charities do not take donations directly, but take them through donation companies who keep a portion of the value of the car. Some that you can look at are Cars Helping America.org and Donation Line.com.

In order for you to use your tax deduction, you have to itemize your returns. It only benefits you to itemize your returns if your itemized deductions add up to more than the standard deduction. Only about 1/3 of all taxpayers itimize their deductions. So unless you car is worth about $5,000 if your are single and about $10,000 if you are married, or your total deductions add up to about that, it is not worth it for you to donate the car. On the other hand, if the car is not worth much at all and you really want to help, donate it anyway. You will not loose much and you will have the satisfaction of knowing you are making a difference.

Both the donor and the charity benefit. The charity makes money, people get a helping hand and the donor gets a tax deduction for the book value of the car. But the IRS will check to see that the amount listed as a donation does not exceed the true value of the car.

A charitable group can do a lot of different things with a donated car. They can sell it at auction, give it to a family who has no car or use it to teach the jobless a new trade that is always looking for new employees. In some cases, the donation company will keep the car and give the charity a portion of the value. You have the right to ask how your car will be used. And to ask the vehicle donation company how much of your donation the charity will receive.

There are many scams operating in the car donation business. They get your car, sell it, keep the money, and your tax deduction certificate will not be legitimate. And the IRS will look at any car donation very carefully. The IRS will provide you with a list of organizations that can accept you car donation. Or you can go to your public library and ask for IRS publication 78. If you have an organization in mind, use it to check them out first. You do not have to worry if you are donating direct to a known charity. Another source of information is your State Attorney General or Secretary of State. They can supply you with the organization's registartion and tax records.