Are You Donate a car to charity
: Are you thinking about donate a car to charity ? donate a car to charity a good tax deduction?
Proceed with caution.
Donate a car could be one of the least profitable ways to help a charity, according to an industry expert
The gift of used cars to "charities" has become a
favorite way for Americans to dispose of unwanted vehicles. And why not? You
can avoid the headache of selling or discarding the car, helping a charitable
cause and reducing your tax burden at the same time.
Donate a car, Unfortunately, the experience is rarely, in reality, a
win-win situation. Not only do charities often see little of what you get from
selling a used car, but donors can come into conflict with the tax collector if
they are not careful.
"At the end of the day, donating a used car could be
the least profitable way to donate to a charity," said Stephanie Kalivas,
an analyst at Charity Watch, an organization that monitors the donation
industry.
Donate a car The problem is that the industry is plagued with fraud and
misrepresentation. Attorneys General of several states have investigated
charitable organizations for the donation of automobiles by false advertising
and self-negotiation. Many of the organizations are for-profit intermediaries
that make symbolic contributions to a participating charity. Others
misrepresent the cause they support and / or give low percentages of their
funds raised to their stated objectives.
According to its website. However, the organization
earned a Charity Watch D rating because it distributes less than 50 percent of
the money it receives and because, despite a national advertising campaign, it
does not adequately reveal that the money goes to Jewish children only, and
almost exclusively in the New York / New Jersey area.
Wendy Kirwan, director of public relations at Kars4Kids,
said that the costs of marketing and operating the car donation program are
high, but because the organization processes internal donations, more money
goes to their charitable work than others. they use third parties He also said
that while the catchy advertisement does not explain which children benefit
from the charity, the information is available on their website at
kars4kids.org. "This is an innovative way to support charity in a way that
helps charity and donors," Kirwan said. "A lot of people would not be
donating to a charity if it was not with their car."
Donate a car For people just looking to get rid of an unwanted car for
which they will not take a tax deduction, it may seem that it does not matter
what happens with the vehicle and who benefits. kas suggests that
charities would be much better if people sold their cars themselves and donated
the proceeds, or simply called charities they know to find out if they have car
donation programs.
If the car in question is valuable and you plan to deduct
it, protect yourself. People who donate cars can be inadvertently marked with a
large red flag for Internal Revenue Service auditors.
- If you do not have the 501 (c) (3) nonprofit status with the IRS, it is not a charity and your donation is not tax deductible.
- Choose efficient charities to give a. There are several organizations, such as Charity Watch, that evaluate charities and qualify them for efficiency in supporting their causes.
- Detail. To take a tax deduction for a car donation, you must itemize the deductions on your return. There are detailed rules about how much you can claim. Taxpayers can deduct the total market value of a donated car in three circumstances: the charity uses the car in its operations; materially improves the vehicle to sell or use it; or the charity donates it or sells it to a person in need below the market value. Otherwise, you can only deduct what the charity receives as a result of the sale of the car.
- Get a receipt. Be sure to get a receipt from the charity for the vehicle and, finally, a document certifying how much the vehicle was sold. Charities must provide that document within 30 days after the sale of the car.
- Do not forget the IRS Form 8283. If the sale price or the fair market value of the car exceeds $ 500, you must complete section A of IRS Form 8283 and file it with your tax return. Check the market values of Kelley Blue Book, Hearst Black Book or National Auto Dealers Association. If the car is worth more than $ 5,000, you must obtain an independent evaluation of it and also complete Section B of Form 8283.
- Leave it. If the car is worthy of the road, take it yourself to the charity you are donating to. Save money and ensure that you do not give the car to an unrelated and for-profit intermediary. Be sure to sign the title of the car to the organization and have a representative sign it too. If someone is picking up the car, ask them to sign the title and take a photocopy of it. People have been aware of the responsibilities of donated cars that were not signed correctly to a new owner.
- Hold it. Take pictures of the car and keep receipts for work and repairs made, especially if you claim a deduction for it.
From today You can Donate a car to charity !!
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