Hundreds of charities have begun to adopt car donation programs as a way to raise funds or to provide themselves with no-cost vehicles to help operate their programs. But rather than managing the car donation programs themselves, they will often turn to fundraising organizations to actually handle the donation and auctioning of the vehicles. And that policy can mean a problem for you.
If you run an Internet search on car donation programs, you will get hundreds of hits from fundraisers who claim that they will let you choose from among a group of charities to which the proceeds of your car's sale, of not the car itself, will go. And they will give you the paperwork you need to claim your car donation as a charitable deduction on your IRS return.
Taking Advice From The IRS
But the IRS itself, in recent years, has become alarmed at the proliferation of car donation programs run by fundraisers which end up keeping the bulk of the proceeds they receive for donated cars. The IRS recommends that it you are considering any of the car donation programs, you contact the people running it and get a clear answer as to whether they are charity officials, or private group acting for the charity.
If you find that they are a private group running the car donation programs of several charities, find out exactly what they plan to do with the car you donate. Will the car be repaired and given to the charity to help in its work? Or do the fundraisers intend to auction the car off and if so, how much of the proceeds will go to the fundraisers, and how much to the charity? For more info see http://www.1cardonationservices.com/Articles/Car_Donation_Services.php on Car Donation Services.
Car donation programs which cannot, or will not, give you clear answers to these questions are not those on which you can depend to see that your ca, or the money it brings gets, to the charity of your choosing. And if the charity does not directly receive the car or its value, you do not have the right to claim the value of the car as a deduction.
Legitimate car donation programs greatly simplify the process of connecting you with a charity which will benefit from your gift. But it's your responsibility to research the various car donation programs in you area and ensure that as much a possible of your car's value will be channeled to the charity, and that the charity itself is one recognized by the IRS. Otherwise, your well-intended car donation may turn into a big problem at tax time, when you attempt to take an unwarranted deduction!
Donating cars to a charity is an excellent and a humble way for a person to make a fairly large investment in charitable work and at the same time helps you to work as a wise steward of your ownerships taking the opportunity of the advantage of escaping paying tax to the government. Car donation program is an efficient fundraising tool sponsored by non-profit organizations as a way to raise money to assist especially the disfavored of the world.
If a person is striving to be a good steward of his financial resources then he needs to become educated concerning the different ways, laws and accepted practices that govern donating cars to charity. There are different ways through which donating car to the charity can be accomplished. You can donate your car directly to the charity of your choice, or you can donate your car to any charitable foundation that converts the material donation into cash, which is gifted to the person in need as a charity. Regarding the different rules concerning donations of cars for charity there are guidelines established for donating cars for charity that include determining fair market value and the correct procedures to follow in order to be able to take a tax deduction for the gift of a car for charity which can be collected by surfing on the Internet or by calling the IRS directly for purchasing the publications concerning donating cars to charity.
Donating your car to the charity offers you an opportunity for you to make a real difference in the lives of the disfavored, handicapped, those in health crisis and those who have met extremely hard times financially for instance Asian tsunami that caused incomputable damage to life and property and allows you to receive your own benefits of a tax deductible gift, free towing of a car that is inessential and a sense of satisfaction of serving someone unfortunate.
Even trucks, RV's, boats, and aircraft can be donated beside car by some car donation programs that will be either sold or repaired to use. The selling or repairing options of the donated car depends on the charitable organization. Though the purpose of all the charitable organization is to help the needy but they also differ in serving the needs. For instance some charitable organization specializes themselves in helping those with health issues, some charitable organization specializes themselves in helping those families in financial hardship whereas others will like to use the funds for humanitarian efforts at home or overseas.
Both Wade Robins & Jeff are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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