Have a car to donate

Car Donation

Those who itemize tax write offs on their tax returns can file a deduction for car donations . There are limitations that can apply. For example, the amount of the deduction may not be more than 50 percent of the total income of the person making the donation.

agency Selection

If Donators want to receive a tax deduction from a donation, then Donators need to locate a charity qualified agency. According to the IRS, any organization that holds an eligibility to receive tax-deductible contributions have a letter from the IRS recognizing them as a charity. Anyone can ask to see this letter to confirm the status of the organization before making a vehicle donation.

The Donators may and should ask the agency plenty of questions about what they intend to do with the donation. A lot of charities want vehicle donations. A lot of charities transfer the vehicle to families in need, some schools use the vehicle in classes to teach auto-repair to pupils and others will only sell the vehicle and use the profits to fund their programs.

Market valuation

The maximum amount allowed as a {deduction} for a car donation is the fair market value of the car. If the fair market valuation of the donation exceeds $250, the Donators should request a written letter from the organization and keep this statement in their records. This acknowledgment should include the agency’s name, a description of the car and atleast one of the following:

An acknowledgment that the agency did not provide any compensation in exchange for the auto
A description and estimated value of the car, provided by the organization
A statement that the only goods or services provided by the agency for the donation consisted of intangible spiritual services, if this is the case

Donators must obtain written letter when filing their tax return for the year in which the deduction occurred. This statement should stay with the files for the applicable year.

Other items that the Donors should include in their paper work related to the vehicle donation are:

* The complete address of the organization
* The date and location where the agency collected the donation
* A description or photograph of the vehicle
*Means of the calculation of the fair market value of the vehicle
* A copy of the auto title, registration

If the value of the auto is more than $500

If the claimed write off for the vehicle is over $500, then Section B on Form 8283 has to accompany the tax return. This form must include the signature of an authorized official from the agency. If the claimed write off for the car is over $5,000, then the Donors needs to obtain a written appraisal of the car. This appraisal needs to be from a qualified appraiser.