Donate a Car for Tax Deduction
There are many charitable organizations available out there that offers help to the less fortunate people of the society. And to operate and run their projects, these organizations heavily depend on donations. Some charitable organizations accept automobiles from individuals to serve their cause. Donating a car to such an organization is not a new practice. However, in the recent times the tax laws have opened a new door of opportunities to individuals to donate a car for tax deduction. So simply by donating your old car, you are not only going to do something good for the less fortunate people of the society, but at the same time this can save you some cash while paying taxes.
Now when it comes to donating a car for tax deduction, you need to make sure that you are selecting a charitable organization for donating your automobile which is eligible to receive cars as donations. Remember, a charity that is not eligible to receive cars as donation won’t be able to help you securing a tax deduction for car donation. The organization should have a good reputation in the arena and should be an IRS approved 501(c)(3) organization. You may ask for authentic documents from the organization to make sure that they are really eligible to accept a car as donation. A church, temple or synagogue can be a great option to donate a car for tax deduction.
It is to be mentioned that some charities will charge you a fee for vehicle removal in case they need to collect your automobile, while others will do it for free. The best option might be to deliver the car by yourself (provided that it is in the right condition to be driven). If you are expecting the organization or its representatives to take care of the delivery, don’t forget to ask if you need to pay a fee for that service.
You need to make sure that the title has been transferred to the organization to which you have donated the car. You should also take care of the outstanding tickets (if any) to avoid any sort of future complications. Your local DMV should be informed about the transfer. So make sure that you are communicating with them. A donor needs to fill up the charity donation papers when they donate a car for tax deduction. Take your time to read the details and fill them up carefully. Don’t forget to keep copies of the title change and donation receipt.
In order to secure a tax deduction for car donation, a written acknowledgement is required from the charity which is needed to be filed along with the tax returns of the donor so that the donor can become eligible to receive tax deduction for car donation.
You can gather lots of information about different local and national charities before selecting one for donating your car for tax deduction simply by visiting their official websites and other online sources. So do use the power of Internet to do some research before selecting an eligible organization to donate a car for tax deduction.
Filed under: Car Donation Tips
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