Donate Your Car for Money
Car process donation is one is one that many car owners go through each year in order to get rid of their vehicles that they no longer wanted and/or needed. And a charitable organization that uses donated vehicle from car owners benefits greatly from such donation. Moreover, getting your car donated for some charity can give you the benefit to get an additional tax incentive while being environmental friendly (through recycling) and while contributing to the mission & goal of a charitable institution. If you really want to get rid of your old car, donating your vehicle to a charitable institution can be a good option to instantly get cash. Here are some of the important points that you may want to consider when you are opting to donate your car for money or charity:
– Donating car for charity. One of the main advantage of donating your car especially in the tough economic times is receiving money, or an equivalent incentive that you can incur for your old car. Indeed, car donations gives you the privilege to take an end of your yearly tax deduction. How much you write off on your taxes are dependent on the fair market value of the car, up to 500 dollars of the equivalent of gross selling price. However, because of the abuse on the system, the current regulations for car donations state that owners are no longer entitled to use the ‘Fair Market value’ of cars more than 500 dollars. If your car’s worth is less than 500 dollar, then you can safely deduct the value.
How to deduct fair market value?
There following are the 4 IRS rules under wherein you can get a maximum tax deduction (Fair Market Value) of a donated car:
a. When your chosen charity auctions or bid your car for $500 or lesser, you are eligible to claim either a fair market value of 500 dollars or whichever is less.
b. When your chosen charity intends to use your car in their work, such as shifting for items or goods for their program, or delivering foods to those needy people. This practice is commonly defined as ‘significant intervening use of vehicle’.
c. When your chosen charity intends to make a material improvement to your vehicle, thus increasing the value of your car and prolongs its life. This do not necessarily means repairing or customizing your car, instead it must be something like fixing or improving the system or engine of the vehicle.
d. When your chosen charity sells or give your donated car to a needy individual at a cost which is significantly below the fair market value, or if the gift or sale is related or part of the charity’s mission in order to help the needy to have a means of transportation.
– Equivalent ‘Cash for Car’ donation. There are some car donation programs that offers partial cash payment for donors that is commonly known as spiffs. This spiffs acts as a ‘gift’ which is being given by charities in exchange for your car donation. This cash equivalent payment comes from proceeds of the sales, and are mostly reserved and given to owners who gives high value donations. Equivalent ‘cash for car donation’ like stiff is a win-win proposition for both ends because the charity can receive a higher contribution for their program, while you as a donor can also reap greater stiffs or rewards at the same time.
Some of the popular stiffs can include; hotel stays in some popular or first-class resort destinations, free or discounts on airline tickets, free membership to some exclusive clubs and other valuable stuffs. Cash equivalents are awarded to car donors are starting to become a popular money-making scheme today, and this is the reason why many profit-driven individuals are taking advantage of the opportunity. But before you donate your high-value car, make sure that the car donation program you choose is tax-qualified (non-profit) and has a reputable standing to avoid troubles or conflicts with the IRS.
What to do before you donate your car?
1. Does your car meet the requirements?
Once you decided which charity program to donate, then you’ll have to determine first if your car qualifies for the donation program in where you wish to submit your vehicle to. Some charities set standards for the car or any vehicle type that are going to take. So make sure to inspect the condition of your car and see if the requirements are met.
2. Preparing for the donation
Depending on your chosen charity program, there might be some preparation takes which needs to be taken care of. In some case, you are required to gather details or information about your car’s model, vehicle, VIN, mileage and others. In order not to delay the donation process, make sure you have all the necessary paperwork required by your charity and as outlined in their program details.
3. Making the call
Once you’ve already decided on which charity program will you donate, and have completed all the requirements and gathered all the important paperwork, all you need to do is to make a call so as to arrange your donation.
Donating Car for Good Purpose
When you are donating your car for charity, you are essentially investing in worthy causes especially in helping others. Some of the popular car donation programs which works strictly on charitable contribution includes programs like ‘Habitat for Humanity’ that is designed to help veterans who have served their country, while other programs are especially intended for helping those people who have certain kind of ailments (cancer patients and others), disabilities (deaf, blind, mute, etc.) or public education. Though you will not receive a cash in hand, there are also tax incentives that you can receive through your charitable works and contribution. Your chosen institutions/organizations will receive a valuable resource from your donation while you at the other hand will receive self-satisfaction from helping those who are in need of your contribution.