Tips For Donating Your Car to Charity

Donating your used vehicle to charity can be a very generous act. Worthwhile charities benefit greatly from donated vehicles either by using them directly or by selling the vehicle and using the profit for their organization. But if you’ve never donated a vehicle before, than where do you start? Here are some tips to make your donation an easy transaction.
Find the Right Charity
If you aren’t sure which charity to donate your car to then do a little research. However avoid the for-profit intermediary organizations that advertise to handle your car donation. These places tend to keep the majority of the money themselves. Some keep as much as 50 to 90 percent or even more for their pockets. Find a charitable organization that handles the donations themselves so they can keep 100 percent of the profits.
Make sure the charity is eligible to receive tax deductible contributions. Make sure they are a 501(c)(3) organization. Other organizations may claim to be a non-profit but may actually be a 501(c)(4) organization and donations to these types are generally not considered tax deductible. Ask for a copy of the organization’s IRS letter of determination which verifies its tax exempt status.
Value Your Car Correctly
The IRS has cracked down on car donations with the passage of the American Jobs Creation Act of 2004. Under this you can no longer claim fair market value for your donated car worth more than $500 but instead you must claim the amount that the charity sells your vehicle for. There are exceptions to this rule and fair market value determined by either Kelley Blue Book or NADA guide can be used when: