What do you do with a car you no longer want but cannot take the time to sell it? You donate it to a charitable cause and feel good about it, isn’t that the way you do it? No, it is not the way you do it. There is more involved here then just taking the car to the nearest charitable organization and leaving it there with a fond farewell. You have to contend with places like the IRS and the Department of Motor Vehicles and any other place that may have a stake in your good deed. Here is a partial list of some of the things that should be done for your own safety.
* Middlemen abound when they know there are a few dollars to be made from a charitable person, after all they know you are making the donation because you do not have the time to make a sale. These middlemen are for profit organizations and will be pleased to help you make your donation for about fifty percent to ninety percent of the vehicle’s value.
* Check directly with the charity you want the money to go to and see if they accept vehicle donations. If they do not then do a little research until you find a reputable charity that does accept vehicle donations.
* If you must use a middleman then be sure to ask how much of you vehicle’s value will actually go to charity. If the middleman’s organization gives the charity flat fees, your vehicle donation may not be eligible for a tax deduction.
* In order to get a tax deduction, the charity must be an approved 501 (c)(3) organization. If your charity is a religious organization it will probably qualify, but you should check it out first. If you do not know of an organization, you can find out from the Internal Revenue Service website and they will have one listed there.
* If you want to save the charity money then deliver the vehicle yourself so that they will be spared the expense of hiring a driver.
* Be sure to transfer the title to the charity and notify your State Department of Motor Vehicles that a transfer has been made. Do not ever leave the space where ownership should be entered blank.
* Be sure that you have the vehicle appraised before you make the donation and get a copy of the appraisal. If the vehicle is worth more than five hundred dollars you will need the appraisal for your tax deduction. IRS will not accept your assessment of the value of the vehicle.
Be sure that you have a complete paper trail of everything you have done in order to protect yourself with the IRS and to avoid any vehicle problems like parking tickets being listed to you after you have left the vehicle with the charity.