Donating Automobiles to Charitable Organizations

Getting rid of an old car may be difficult. If the vehicle is very old or in bad condition, most used car dealerships will not purchase the automobile from you. Of course, there is always the option of giving the car away. In this situation, a child or other family member may appreciate an extra set of wheels. If no one is willing to take possession of an old car, you may think about donating the vehicle to a local charity. Car donations are possible, and many charities are considering cars an acceptable donation.

Research Different Charities. Finding a charity that accepts car donations is very simple. To begin, it may help to browse the charity section of the local yellow pages. Select a few charities, and make a quick phone call to inquire about car donations. Large advertisements for a particular organization may mention vehicles as an acceptable donation. Although many organizations accept donations, if they are not a registered charitable organization, you will not receive a tax deduction for the vehicle. Thus, it is important to inquire about their registration status.

When donating a car to a charitable organization, vehicles are not required to be in excellent condition. In most cases, the organization will auction off the vehicle or sell it for parts. The money received from the disposal of the vehicle will become possession of the organization. Organizations have many uses for the money. These may include food drives, community projects, Habitat for Humanity homes, etc. Whatever the charity's or organizations cause, be assured that your donation will be put to good use.

Know the Fair Market Value. Before donating a vehicle, it is smart to have the car appraised. You have the option of hiring a professional to assess the value of the car. However, if the car is a piece of junk, the Kelley Blue Book can provide an accurate fair market value

Get a Tax Receipt. The organization accepting the car as a donation may either provide a tax receipt upon pick-up of the vehicle, or wait until the vehicle sells to send a tax receipt. Either way, to claim the donation as a tax deduction, the IRS requires a tax receipt stating the charity's name and tax identification number. You may be obligated to provide addition information such as the vehicle's make, model, and year.

After obtaining necessary paperwork to satisfy the IRS, the next step entails contacting the Department of Motor Vehicles and the local city's tax department. Notify both departments that the vehicle has been donated. This alleviates receiving annual re-registration and personal property tax forms.

Arrange Pick-Up. Most charities that accept donated automobiles will pick-up the car free of charge. If a particular charity does not offer free pick-ups, ask to bring the vehicle to their location. If the vehicle is in good running condition, this will save you money. Nonetheless, it is possible to find an inexpensive towing company that is able to transport a non-running vehicle to the charity's location.