Auto Donation – Before You Donate A Car To Charity

Are You Considering Making A Charitable Car Donation?

If you are deciding to donate a car to charity, you probably want to know how much it will be valued at. This requires you to fairly assess what purpose it will likely be used for as well as its true condition.

When consulting the Kelley Blue Book for a generalized appraisal value, many people fail to consider that even a “poor” rating assumes that the car can move without facing downhill and that it’s capable of getting current tags in the state that it’s registered in.

Of course, by the time many people even think to make a charitable car donation, they’re often far beyond this point. Indeed, since a great many charities (or their third-party, for-profit agents) will more than happily send someone to pick up vehicles that haven’t run under their own power, you can be assured that even the scrap metal has more value than you might think.

Finding The Value Of Your Car

The first thing to do is to take a look at the Blue Book value, for private party sales. This is the value you can expect to get when you put an ad in the paper and try to sell the car yourself. Before you donate a car to charity, you need to know what other people are paying for it before you get any grand ideas of whittling your tax bill down to nothing.

There will be a section by where you answer a series of specific questions about the condition of the car. You may be surprised just how a few small dings can really impact the resale value whether or not you choose to donate the car. Charity organizations, of course, have the same access to these figures as yourself. So, be honest. If you come up with a condition that is less than “poor,” odds are you’ll have to settle for the paltry sum the auto will pick up at the wholesale auctions.

Is Your Car Donation Scrap Metal?

Unless you’re able to find a charity that will use your car as a car (rather than scrap metal and parts), you’ll have to accept that the charity you choose will get only 30-50% of that revenue after the price of towing is figured in.

If, on the other hand, you’re able to find a charity that has a training program to teach young people the mechanical arts, perhaps there is a way to get a bit more for your car. However, if you’ve got a terrible clunker, you probably ought to forget it. There’s no point in fixing something up if it has no chance of being either valuable or cool.

It may take a while, but after as many as nine months, you’ll get a slip of paper informing you of what your donated car at charity auction sold for and netted the school you donated it to. Colleges are also able to receive auto donations that will be refurbished and resold, to your mutual benefit.

It is also useful to consider that you may receive a higher deduction value if your car is refurbished and donated to a needy individual or family in the area. Some cities run programs like this and are even able to accept should you donate your car to the charity of you municipal government.

Organizations that teach people basic car maintenance and body work are probably not as interested in fast and swishy-looking cars, but will take a serviceable vehicle that has very little wrong with it. If you happen to know what the problem is, all the better, as it will give the charitable organization or NPO something to base a decision upon.

So, consider the value of your car when it’s been fixed up, both a little and a lot when you’re deciding what to do when you donate a car to charity Though not a credit to take off your total tax bill, deductions reduce the income you’re to be taxed upon. The actual amount of money you’ll save (or be refunded) is dependent upon your tax bracket.

However, by taking some time and effort when you donate a car to charity, you can vastly increase the amount of money your car is worth as a deduction under the new IRS rulings affecting auto donation and deductible amounts.

Car Donation to Charity and Non-Profit Organizations

If you are contemplating a car donation to charity, you should consider just how the charity or NPO in question could actually use the donation of a vehicle. Just as there are now restrictions of usefulness on what one can claim from household object donations, a car that runs (or can at least be repaired without major capital investment) is far more valuable to a charity that can actually use the car directly to further their charitable mission.

Consider a charity that employs a third party, for-profit organization to facilitiate all car donations to charity. After their cut is taken, there is sometimes very little left over to actually be donated to the charity in question. Moreover, if you give a car that is only fit for scrap, the invoice statement you’ll be given as a guide to your actual deduction benefit will reflect this.

Usually the value is far higher for a running car in terms of total money produced by the sale of your car as well the percentage of that the charity is able to keep from said sale. This means more money to reduce your net taxable income, too. Cosmetic damages are usually unimportant to a NPO or charity that is primarily concerned with the functionality of non-cash automotive donations.

Because many of the third-party agents that handle car donations to charity have turned their attentions elsewhere since 2005, there are many NPOs that formerly took auto donations but are no longer accepting them because of all the bother associated with running such a program themselves.

Sometimes, this is simply because the agency lacks a tow truck of its own to pick up cars. Whether they’re running or not, vehicles are almost always towed away to avoid liability issues. As such, this type of car donation to charity, even if the tow truck in question is not in the best shape ever, can be incredibly useful as well as being a high-ticket item for deduction purposes. Not only will you be able to claim a highly useful fair market value deduction, but you’ll also help the charity or NPO collect a lot more money and automobiles in useful car donations that they may have otherwise had to pass on.

Of course, another way to maximize your donation dollars is to make sure you have a free and clear title that can be easily transferred without making staff members of the non-profit jump through proverbial flaming hoops at the department of motor vehicle office. Often people remove the existing license plates and leave the title inside the glove-box for the towing company to find. This allows you to make sure that you’re not held liable for any of the traffic violations a teenage Meals on Wheels volunteer may commit with your former car. Donations to charity don’t need to put you in a vulnerable position!

Overall, the reliance of most NPOs on car donations to charity has remained somewhat low. This is true of most charitable organizations with the exception of those that specialize in giving cars away to needy folks who require reliable transportation. Even if they sell them at a discounted rate, such charities are especially valuable to donors as well as the populations they serve.

If your car is still running, even if it has become ugly, is of great use to many of the organizations that still accept car donations to charity. Choose wisely to make sure your car is put to the best possible use. If your car is fit for little else than scrap, donating it to a charity that requires running vehicles may not be much of a useful donation at all.

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