WHAT TO EXPECT WITH AN
Auto Donation
A Straightforward Review
When it comes time to turn your old car “out to pasture,” you’ve got several courses you could take. There’s always the option to trade it in toward the purchase of a new automobile, but you’ll likely get far less than market value on a trade-in. You could arrange to sell the vehicle outright, but this may not be a good option if you’re looking to move the vehicle quickly. An outright sale will also require certain expenses, such as advertising the vehicle. If only you had the ability to make a phone call, have someone pick the automobile up, let them handle all of the headache, and give you a nice sum of money for your vehicle in the deal.
Basic facts on Auto Donation. |
Well, that’s pretty much what happens when you make an auto donation. Granted, there is a small amount of paperwork, and they’re not going to hand you a check on the spot, but an automobile donation is just about as straightforward a way to move out an old vehicle as you can get. The charitable organization handles almost all the footwork, and you get a very nice tax deduction, which could turn the dreaded Tax Day into Christmas come late.
When you dig into this method of philanthropy, what you find among the various organizations is basically the same operation: you contact the charitable organization by phone or online, and they will collect basic information about you and the automobile you wish to donate. If they accept your auto donation (and they very likely will, regardless of its condition), they will coordinate with you to arrange a pickup time and place for them to take possession of the vehicle. The time frame for the pickup is often 24-72 hours from the time you call to donate. They’ll ask you to have the automobile title signed over and ready when the tow truck arrives to make the pickup. The tow truck driver will give you some type of receipt for your vehicle, then carry it away. And just like that, you’ve got a nice tax deduction.
How much tax deduction you get to claim from your auto donation will depend on a number of factors, not the least of which is the value of the automobile. If you determine that the “fair market value” of your vehicle is less than $500, that simplifies things, and you’ll claim that amount on your tax forms. If the automobile is worth more than $500, you’ll need to wait to hear back from the charitable organization as to what they actually received from the vehicle sale. They should send you the necessary documentation to verify the amount received from the sale of your automobile, then you can turn this information over to your accountant and get a larger deduction. The charitable organization may actually invest in refurbishing your automobile to get a higher resale value (which can mean an even larger deduction for you).
After that, it’s simply a matter of waiting on “payday” when that nice deduction kicks in at tax time.
Of course, like most things in life, ‘results may vary,’ and depending upon things such as the charitable organization you choose, and laws and regulations in your specific area, your personal experience may require more or fewer steps to complete your auto donation. But this review of the car donation process will give you a basic, straightforward review of the general experience of donating your automobile. If you’re looking to get some cash quick for your old vehicle, this process is probably not for you. But if you can wait a few months for that tax deduction, an auto donation can be a relatively simple way to get the car out of your yard, get a nice tax deduction, and also change someone’s life by supporting your favorite charity.
Looking for a nationwide list of agencies accepting car donations?
Visit our Charity Directory page!
There you'll find organizations from coast to coast, including listings by state, to help you narrow the list of candidates to whom you'd like to donate.
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