The ABCs of Car Donation – L is for Learn

Learn everything you can about the entire car donation process and its benefits to you. First, learn whether you can claim the tax deduction  you will receive for donating your car to charity.  You can only claim the tax deduction if you itemize on your federal income tax return. 

If you regularly itemize on your taxes, you will get a financial benefit if you donate your car. If you do not normally itemize, you should learn whether you will be able to if you donate car. A simple way to learn whether it will make a difference is to re-calculate your previous years’ taxes as if you donated a car. If car donation would have allowed you to itemize on your taxes last year, it probably will this year as long as there are no other major changes in your financial situation.

Next, learn what charities will let you donate your car based on its condition.  Many charities will only accept vehicles that are under ten years old, run and have no significant problems, rust or body damage. If your car does not fall into this category, you only have to do a little research to learn what charities will accept it.

Once you compile a list of charities, learn all you can about them. One of the first things you will want to learn is whether the charity is an IRS qualified organization. If you donate car to an unqualified organization, you will not be able to claim your tax deduction. In general, qualified organizations are 501 (c) (3) organizations. To learn more, see IRS Publication 78. Other things you will want to learn about the charity is their reputation in general, any complaints that have been filed against them, the portion of proceeds from car donations that go toward charitable purposes, etc.

Next, you will want to learn about the entire car donation process. Learn where and how to sign over the title to your car. You are the seller and will need to sign the title in the space marked “seller’s signature”. You need to sign your name as it appears on the title. If there is a lien listed on the title, you need to learn whether a lien release is necessary.

Once you sign the title, you need to learn what to do with it. Some charities ask you to leave it in the car. This is never a good idea. Some will ask you to give the title to the towing service when they pick up the car. Still some charities will ask you to mail the title to them. They ask that because it is safer for you to have it in their hands rather than those of the towing service.

You also need to learn what to do with your license plates. Most states require you to remove them.

Finally, learn what type of documentation you will receive from the charity. If your car is sold for more than $500 the IRS requires the charity to provide you with IRS Form 1098-c.

The more you learn about car donation the smoother the process will be for both you and the charity you donate car to.

The ABCs of Car Donation – K is for Knowledge

Knowledge is power even when it comes to car donation. The more knowledge you have about the car donation process, the better decision you will make about whether to donate your car and what charity to donate car to.

The answer to the question of whether to donate your car is determined by your motivation for donating it. If your motivation is simply to help the charity, the answer is of course; donate car.

If your motivation is get a tax deduction you will need to gain some knowledge about what the tax deduction is and if will you be able to claim it. To claim the tax deduction, you will need to itemize on your Federal tax return. That means you will have to file Schedule A. Your actual benefit from your car donation is determined by the tax bracket you are in. For example, if you are in the 35% tax bracket, your actual benefit is 35% of the amount you claim for your car donation.

There are several things that will determine which charity you donate car to. One of them is the mission of the charity. There are a very wide variety of charities that accept vehicle donations. They include international and national charities as well as state, regional and local ones. Their missions range from conducting research on many diseases and afflictions, to helping those who are afflicted, to animal rights issues, to environmental issues, to programs for young people, to care for the elderly, disabled, injured or abused, to local food banks, homeless shelters, hospices, etc.

Once you determine the mission you wish to support, you will want to obtain some knowledge of their efficiency, effectiveness, reputation, etc. There are a number of ways to can check them out. Some of the places you can check are Charity Navigators, the Institute of Philanthropy, GuideStar, etc. If the charity you are checking on does not have a good rating, those guides will show you alternative ones.

Once you have narrowed down you choices, you will need to gain some knowledge about their car donation process. One thing you will want to know is whether they handle donations themselves or use the services of a car donation center. Many use a car donation center. One reason they do is because the vast majority of donated cars are sold. There is a certain level of expertise required in operating a car donation program. It requires the knowledge of the rules and regulations involved in the sale of vehicles, the transfer of titles, what to do with the license plates, etc. These rules and regulations vary by state. Many charities prefer not to use their resources for this and often find it to be more cost effective to use a car donation center.

Next, you will want to gain some knowledge regarding the qualifications the charity has for accepting a vehicle. Many prefer to only accept those cars that run and are less than ten years old. Other charities accept vehicles in virtually any condition as long as they have not been stripped of their parts and are in a location from where they can be towed.

The more knowledge you have regarding the intricacies of car donations, the more you will know whether and where to donate your car.

The ABCs of Car Donation – J is for Joyful

Car donation is a very joyful thing when it is done correctly. To make it a joyful experience, you simply need to follow the instructions given to you by the car donation charity. Those instructions are designed to make the entire process joyful for both you and the charity.

They will include the details on where and how to sign over the title as well as what to do with the license plates for the vehicle. The instructions will vary by the State the car is located in and where the car is parked. For example, if your car is parked on the street you may need to be there when the tow truck arrives. If you car is parked in a driveway, you may not need to be present as long as you let the towing service know where the car keys are.  Following these instructions will ensure that the title is joyfully transferred out of your name and will help to prevent you from receiving any unpaid traffic tickets which may be acquired by the next owner of your car. It is joyful for the charity since they will not have to deal with any title or ticket issues which could delay the sale of your car.

When you donate your car to charity, they will be very joyful because the revenue generated from the sale of your car donation will help them to further their mission. Those that benefit from the programs of the charity will also be joyful to receive that assistance. The poor economy is putting a lot of strain on charities to provide more assistance.

When you donate car to charity you will receive a joyful tax deduction. You will also be joyful because you will free up space in your yard, and not have to pay anymore for the car insurance, registration fees, inspection fees, etc. In fact, you may get money back for any unused insurance or registration.

Most charities are very joyful to let you donate car that is old, no longer runs, has a lot of body damage or needs a lot of mechanical repairs. That makes it joyful for you since you will not need to make any repairs to the car to continue to drive it or to get it to pass inspection or to be able to sell it.

When you donate car to charity, you will be joyful to know that your car donation will help to support a very good cause. You will also be joyful when you see the wide variety of charities you can donate your car to through Cars4Charities. They represent charities that provide international aid, or support research on many diseases and aliments, or help young people, or assist people or animals who have been abused or who are injured, sick or in need of food and/or shelter.

To donate car, just go to the Cars4Charities website, http://www.cars4charities.org/ or call them toll free at 1-866-448-3487. They will joyfully provide you with all the car donation details.    

The ABCs of Car Donation – I is for Investigate

Investigate the charity or car donation center you are thinking about donating your car to. All charities and all car donation centers are not alike. As with everything is life, there are some good ones and there are some unscrupulous ones. You will not know if you do not investigate them. There are some relatively easy ways you can do that.

Before you donate your car to a charity or a non-profit car donation center, you should check out their tax filings by simply logging onto irs.gov. Once you do, click on the charities and Non-Profits tab and then the Search for Charities button on the left. You can also check them out through sites like Charity Navigators, GuideStar, etc. You should also check with the Attorney General’s office for your state to see if any complaints have been filed against the charity. In 2010, the New York State Attorney General launched an investigation into several alleged “scam” car donation charities in the New York City area. One of them was actually shut down because it used less than two percent of the money from car donations for charitable purposes.

The other thing you should investigate is the tax deduction you will receive when you donate car. Most charities sell car donations because there is too much liability involved in giving a car to a needy person or selling it to them at a really low price. In addition, charities rely on the proceeds from the sale of car donations to help them fund their mission.

If the charity sells you donated car, you can claim the greater of $500 or the amount the charity actually sells your car for. To maximize your tax deduction, you will need to investigate how the charity or car donation center will sell your car. Some charities sell all car donations to the same vendor. This is never a good idea as the more competition there is the higher the sale price is likely to be.

Other charities auction all cars. This is a good thing if the donated car is in decent shape. However, if the car needs repair or is in poor condition, it may not bring the best sale price. The reason for that is because the buyer has to pay a fee to enter the auction and another fee to purchase a car at the auction. Buyers often take these fees into consideration when bidding on vehicles.

Often, the best sale price comes from using multiple vendors for selling donated cars. Here’s why. If the donated car is in good condition, it makes sense to sell it at auction so that more buyers are allowed to bid on it. If the car is in fair condition, selling it directly to a used car dealer may bring the highest price since they may be willing to pay more money for the car to avoid the fees charged by the auction facility. If the car is really in poor condition, a parts yard may be willing to pay top dollar for it so that they can re-sell the useable parts and the scrap metal from the car.

Investigating the method the charity or car donation center will sell your car for will help you determine whether they will get you the best tax deduction for your donation.

The ABCs of Car Donation – H is for Help

If you have a car you no longer want or need, please consider car donation. When you donate your car to charity, it helps in a lot of ways. If your car donation is in good shape, the charity may decide to use it themselves. This helps them tremendously since they will not have to spend money on a vehicle to use. If your car donation is not in good condition or the charity does not need it for themselves, they may sell it.

The sale of your car will help many people. The charity will use the proceeds from the sale to help them further their mission. They may use it to conduct research on a variety of illnesses or issues. They may use it to provide information or services to those inflicted with illness, or they may use the proceeds to provide counseling services or for education. They may also use the proceeds to help provide shelter, food and medical services to needy individuals or animals.

In addition, if your car donation is sold it will help your community. Most car donations are sold through auctions, or directly to used car dealers or salvage yards. Auction facilities charge a fee to sell donated cars. Those fees help them employ more staff. The used car dealers have to repair car donations so that they are road worthy before they can sell them to the public. This helps provide a source of revenue to the dealer as well as the repair shops. It also helps to provide reliable transportation to the public. If your car donation is in poor condition the charity will probably sell it to a salvage yard. The salvage yard will sell all the useable parts from it for a price that is a lot less than the cost of new parts. That will help people who do not have a lot of money keep working by keeping their car on the road. Once all the useable parts are removed from the car, the salvage yard will crush the rest and sell the scrap metal. That will help provide construction materials both here and in other countries.

In a few cases, charities will give or sell donated cars at a greatly reduced price to help a needy person. Usually, they do this so that the person will have adequate transportation to and from work. This helps the person become independent, which in turn helps the economy since they will be purchasing more goods and services. A person who is working is paying taxes instead of receiving assistance from the government. That helps their self esteem and helps all of us taxpayers.

When you donate car to charity, you also help yourself. You get rid of a vehicle you no longer want. That helps to clear your yard. You will also help your wallet when you donate car since you will probably get a rebate on your car insurance, registration or license fees. Best of all, you will be helped by getting a valuable tax deduction.

The ABCs of Car Donation – G is for Good

There are good car donation centers and there are some not so good ones you can donate your car to. In 2010, the attorney general for New York State launched an investigation into several possible “scam” car donation charities in the New York City area. One car donation center was actually shut down because it used less than two percent of the money from car donations for charitable purposes.

You can easily find out whether the car donation charity you are thinking about donating your car to is a good one or not a good one. You can check them out through the attorney general’s office for your state. You can also check them out through the internet. With all of the really good car donation centers out there you can donate car to, there is no reason to choose any center that is not good.

Once you do find a good charity to donate car to, you will feel good about your decision. Your car donation will do a lot of good as well. If your donated car is in good condition, the charity may decide to use it themselves for their own charitable purposes. They may even decide to sell it to a person in need at a greatly reduced price or even give it them.

If your donated car is not in good condition, but is easily repairable the car donation center may repair it before they sell it. If your donated car is not easily repairable, the car donation center will sell it as it is. You can still feel very good about donating a car that is rusted or is basically junk. Since the price of scrap metal is up, the charity will be able to sell it for good money.

Most car donation centers sell all donated cars in the condition they are donated in. They do it because it is good for them. It is good for them because they do not have the expense of making repairs, they do not have any liability issues and they get the cash for the cars quicker. Improving their cash flow is a very good thing for the charity.

Another good thing about car donation is the good tax deduction you will get when you donate car. In general, your good tax deduction will be the amount the charity sells your donated car for or $500, whichever is more. However, if the charity uses your car, sells it to a needy person for an extremely low price or gives it to them, your good tax deduction will be the fair market value of the car.

There are a great many good things about car donation. You get rid of a car you no longer want or use. That alone is a good thing. The charity you donate car to will either put it to good use or get some good money for it which will help them do good things. You will also get a good tax deduction when you donate car. Car donation is truly all good.

The ABCs of Car Donation – F is for Free

When you donate your car to charity, you will be free from many things.  You will be free from the hassle of dickering with the car dealer over the trade in amount of your car. According to most auto buying guides, not having a trade in will free you up to negotiate a better sale price on the purchase of a new car or quality used car.

You will be free of the cost of having to advertise your car for sale in the local paper or on line. You will be free in any costs involved in repairing your car to make it easier to sell. Most charities will gladly let you donate car that needs a lot of work or does not run.

You will be free of the inconvenience and risks of having to wait for strangers come to your home to look at your car. You will be free of the aggravation of having those prospective buyers offer you a low ball amount for your car. Since you will not have to wait for prospective buyers to call or visit, you will have a lot more free time to do other more important things.

If your car is in really bad shape and does not run, you will be free from the cost of having a junk yard come to haul it away. You can donate your car to charity even if it is junk. The call to the charity is also free. Once you have everything is coordinated with the charity, they will dispatch a tow truck to pick up your car. The pickup of your car is another thing that is completely free.

Once your car is picked up, you will have a lot more free space in your garage or driveway. You will also be free of any more car insurance, registration, inspection, licensing fees, etc. In fact, you may be due a rebate on some of the fees you have already paid.

When you donate car to charity, you will receive a free tax deduction on your itemized federal income taxes. In most cases, the amount of your tax deduction will be the amount the charity is able to sell your donated car for or $500, whichever is greater. The charity will indicate that amount in the tax paperwork they send you. That paperwork will, of course, be free.

Finally, the best free thing is the wonderful feeling you will get knowing that your car donation will be used to help support a very worthy cause.