How To Donate Cars for Maximum Tax Benefits

If you have a vehicle that you no longer use, consider donating it! Aside from altruistic reasons to make a donation, give your car to charity can be used to help lower your taxes. There are various organizations that can benefit from your donation, but if you're after maximum tax benefits of your donation, here's what you can do.
How To Donate Cars for Maximum Tax Benefits
How To Donate Cars for Maximum Tax Benefits

How To Donate Cars for Maximum Tax Benefits :

  1. Talk to your accountant. Before making a donation, arm yourself with the right information. Instead of asking around, it's best to speak with your accountant or tax lawyer will have the most up to date information about the tax benefits of donating a vehicle. If you do not have an accountant, you can log on to the IRS website and review the guidelines for donor information.
  2. Choose a charity. For your donation be tax deductible, the charity that you choose must be on the approved list from the IRS. You can go to the IRS website to find out whether the charity of your choice
  3. Registered as a non-profit charitable organization. Goodwill Industries and the Salvation Army is a prime example of an IRS registered charity. You can also log on to the charity's website to get information about the organization you choose. If the organization is not registered as a non-profit, the value of your donation may not be utilized to the maximum tax benefits.
  4. Evaluating the vehicle. The higher the value of the vehicle, the greater the amount you can register in the form of tax cuts. Get your year, make and model of the vehicle, as well as the odometer reading to get the mileage of the vehicle. Note if the car has special features such as four-wheel drive, a good sound system and so on. Next, find a low blue book value of the car by checking the Kelley blue book on kbb.com. You can also use Edmund TMV Used Vehicle Appraiser.
  5. Know how the vehicle will be used by the charity. Charity can sell the vehicle at auction. In this case, only the residual value of the vehicle is what can you list on your tax form. Would the charity itself using the vehicle for more support programs, such as the Work Programme Goodwill Wheels? Finally, some of the vehicles donated to charity delivering other people in need as a means to fulfill the mission of charity. One of the charities Charity Cars. Donating Cars USA is the group that received the vehicle to pass on to other charities. If your vehicle is donated directly used to advance the cause of charity, you can get the maximum tax benefit for your vehicle donated.
  6. Know the amount of contribution limits. IRS rules have changed when it comes to car donations. For vehicles worth more than $ 500, only the actual selling price of the vehicle such as that sold by the charity can be given a tax credit, not the fair market value of the car. You will find this value within 30 days from the charity when you get a receipt from them, which you will attach your tax forms. If the donated vehicle is used to fulfill the mission of the charity, then you may register for the full market value of the vehicle. It will depend on the charity you support.

Once your document is finished, save your form. Filling the appropriate IRS tax form to register your itemized tax deduction. Be sure to include all supporting documents when you submit your tax forms.

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