You might be new to the world of vehicle donations or have probably heard about the stuff yet still confused as to why, how and where it happens. Doing a vehicle donation in the US is a common practice for people who are fond of owning multiple cars.
It is also the habit of those who buy used cars after a year or two then decide to park it in their garage for long since they already have a new one. This usually happens to most men who are actually fond of cars and other vehicles for road trips and adventure.
How to Find the Right Charitable Institution for Vehicle Donation
Charities come in various forms and sizes for different causes. There are some charities that help children, others aim to combat hunger, other support animals and many other humanitarian advocacies. This post aims to give you guides and tips in doing the right things regarding your vehicle donation.
You can do your own Google search or even local searches for the charities you opt to deal with your plans for car donation. The key here is to find a cause that is so close to your heart. Then from that list of charities, do some extensive research for the highly valuable ones to have your vehicle donated for their cause. You can even visit your shortlisted institutions for further scrutiny before making your final decision. Or contact respective websites for some questions you may have to ask.
How to Actually Donate Vehicles for Charities
Here are the necessary steps that you need to follow in donating your vehicle successfully to charity.
Looking for the right charity for your vehicle donation project is just your first step. You also need to verify the authenticity of the charity with 501© (3) registration for you to legally claim tax reduction. A charity that accepts car donation without a removal fee is even recommended to avoid further issues.
Determine the Vehicle’s Fair Market Value
The Kelley Blue Book or IRS Publications 526 and 561 can help you determine your car’s fair market value for tax reduction purposes. It is best to have you car appraised by a certified professional.
Donate Your Vehicle Upon Appraisal
Once you take the leap of donating your automobile to charity, it has two options to make. One is to use the vehicle for charitable tasks where you are entitled for its fair market value. Another thing is to sell it and use the funds from it for charitable functions. This option lets you receive your receipt with the charity’s name, your name as the donor, vehicle’s make and model, tax ID number and other details wherein you can claim up to $500 of the car’s value.
In cases where the value exceeds $500, you need to fill out a W9 form. This allows the charity to file 1098c form to register your donation with the IRS. Once this is done, you will receive a copy of the 1098c form showing your car’s sale value.
Follow your respective state’s regulations regarding the plates and title after you have notified the motor vehicle department and insurance company that you no longer own the vehicle. Keep your completed IRS Form 8283 and receipt for tax filing and claiming deductions.