How to Get Maximum Tax Benefit by Donating your Vehicle 2016 – Updated

Last Updated: 26 October, 2016
Charity Car Donation Tax Deduction

Donating your car or vehicle to charities help to shape many lives and the most rewarding things you can do. There are several people in the US who cannot afford for a vehicle, even a small car. They have to rely on other modes of transport for which they have to shell out a huge amount from their income.

When you donate a vehicle, you’re helping charities in several ways. They will hand over your car to the needy which may help for the betterment of their life. Charities use the money raised from your donation for various purposes, mostly for homeless people on Education, Health, Homes, and many ways.

Car Donation benefits:

Philanthropy is the best way to eradicate poverty, and car donation is the best way to recycle your old car or vehicle. You will be rewarded for your philanthropy from the mouths of millions of helpless people.

You can even get tax benefits from your car donation. Why don’t you donate a car when it helps someone? Instead of killing the car in your garage, you may donate it to charities. There are several charities out there in your region but beware about scam charities that use your vehicle for their benefits. I recommend you to look for a genuine charity to donate your car.

You can get rid of your old vehicle and at the same time, you can also claim your tax leverage based on the amount of your vehicle is sold. If your vehicle is sold for less than $500, you can claim a fair market value based on the amount it is sold. And, if it is sold for above $500, you can claim for the exact amount for which the vehicle is sold.

Since 2005, IRS has simplified the process of determining the value of your vehicle. So, it is now easy to claim your charitable tax deduction. Ensure that you’re contacting a charity service that is recognized for IRS tax deduction.

What do you need to make a donation?

Before donating your vehicle, you’ll need documents such as registration and insurance. A valid title issued by the state motor vehicles under the name of the person who is willing to donate. In case you lost your title, you can get a photocopy of the title from Center Authority.

You don’t need to worry about handing over your vehicle to charity. Whatever the condition of your vehicle maybe, the charity will pick up the vehicle from your doorstep. While picking up your car, don’t forget to get the tax form, some will email the form as well.

By making auto donation, you’re helping the fellow people of your society.

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