(Photo By Flickr User Greg Gjerdingen)
Cars are one of the most popular kinds of non-cash donations- each year, Americans donate more than 200,000 old cars to certified charitable organizations. This enables charities to provide transportation to families that don’t have means, and transport patients to care. The donors don’t walk away empty-handed, either — they receive tax deductions worth an average of $1,250 to a donation.
If donations involving such old cars aren’t common, it is usually because they are either unaware of how welcome their donations are likely to be or don’t know anyone who has donated a car. An old car, though, is usually one of the best ways to give to a charity that works for a cause that you support. Take a look at these reasons for why, if you have an old car standing around, you should call a charity as soon as possible.
1. The tax benefits
Donating your car to charity is an excellent way of getting a sizable deduction for your tax return. Not only do you get to feel good about your donation, you actually make money of the deal, just as you would selling the car. Depending on the model and the condition that it is in, you could work hundreds off your tax return. You do need to pay attention to some of the finer points of the IRS’s rules for car donation deductions, though.
For years, the IRS simply took people at their word when they made car donations — if a taxpayer claimed that a vehicle he donated was worth $1,000, they accepted it without question. Thousands of taxpayers, though, took advantage of the system by overstating the potential worth of the cars they donated and claiming overly generous deductions. Since then, the IRS has tightened its rules. When you claim a deduction now, you need to provide proof in the form of acknowledgment from the charity that it’s sold the car that you donated for the amount that that you’ve claimed.
2. It is often easier to donate than to sell
If you have a car that’s little more than a pile of junk in your yard, or a burnt-out shell, you would normally have to pay to have it transported to a scrapyard. If you were to choose to give it to charity, though, you wouldn’t need to worry about transportation costs — they would come over and pick it up themselves.
Since you would receive an acknowledgment for the amount of money that they made off your car, you would receive a deductions that were far higher than what you would make if you sold your car yourself.
3. When you can’t afford to give cash, a car is a great alternative
With the country going through an extended economic downturn that’s only recently begun to pick up, charities have been badly hit — many people who could afford to support them with their contributions are no longer able to write out checks. If you find that your paycheck doesn’t go as far, but would still like to make a donation, a non-cash contribution can be one of the best ways to go. If you have an old clunker taking up space, giving it to a charity won’t cost you anything, yet it could prove to be valuable to the charity — they know how to turn it into cash.
4. If the car you donate is drivable, you get to change lives
While charities will always accept vehicles in very poor shape, they can do much more with cars that are in good enough condition to be driven. Not only can they retain them for their own transportation needs, they can donate them to poor families in need of a vehicle for employment purposes — thousands of people are in a position where access to a vehicle can make the difference between being employed and being on the street.
5. It isn’t difficult to find genuine charities
Many people have cars to give, and would love to make a donation — they are just not sure about where to find a genuine charity that could put their donation to good use. Finding a good charity, though, is no harder than finding a good business. Make sure the charity you select is a qualified organization, like the American Lung Association’s vehicle donation program.
Whatever condition a car may be in, it’s a valuable thing to give to a good cause. If unfamiliarity with car donations is what makes it difficult for you to get started, you only need to find a good charity to call. Once you contact them, they’ll be happy to take over the process.
(Information courtesy of American Lung Association)
