Selling Your Car? Why Not Donate it Instead?
By Teresa Ambord
If you've ever tried to sell a used car, you know the hassles. There's nothing worse than having bargain hunters test drive your old car--maybe a car that has served you well in the past--and have to listen to them say terrible things about it, even as they are trying to make a deal. Of course, you know that they are trying to drive down the price. Still, it can sting. And it takes up your time.
If you've traded in an old car for a new one, you also know that the dealer will give you next to nothing for your vehicle. You can save the hassle and donate your car to a worthy cause. They will appreciate it, take it off your hands with very little effort on your part, and you'll get a major tax writeoff in the process.
How Do I Donate?
Donating your car (you can also donate trucks, boats and RVs) gets easier every day, as organizations line up to receive them. You can usually find some local charities that accept vehicle donations by looking in your newspaper. Or, see a long list of such organizations by going to:
Check Out the Charity
But before you donate, do your homework. For your donation to be tax deductible, the organization has to be qualified. Here are a few ways to find out:
- Ask to see the charity's Letter of Determination from the Internal Revenue Service. This is a letter verifying the tax-exempt status of the charity. If the organization is a church however, churches are not required to file for tax-exempt status, and your donation should be tax deductible.
- Contact: Give.Org. You can go there, fill out a simple form, and the Better Business Bureau will contact you with the information you request.
What You Will Need
After you select the charity, verify that they are tax-exempt, and contact them, be prepared to give them the lien-free title. The organization may ask you to mail the title to them, and once they receive it, they will arrange to pick up your vehicle. Approximately 45 days later, you should receive your donation receipt, which you should tuck away with your tax records.
What's My Donation Worth?
You can deduct the fair market value of your car. Fair market value (FMV) is the price you could get if you sold it on the open market. For help with determining the FMV, visit:
