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Are You Considering A Donation To Charity? Before You Do, Read This First
Many Americans donate vehicles to charities each and every year and are able to claim the deductions on their tax returns. However, each year many other Americans donate vehicles to charities and are unable to claim the deduction for a variety of reasons. Because of this, it is important to follow the rules set forth by the IRS regarding charitable contributions of vehicles and to have any and all questions answered before making a donation.
Your first action when considering a charity to donate a car to is to check and see if the charity is qualified. The reason you need to do this is to see if the charitable organization is legitimate. This is really easy to do and all you have to do is log onto the IRS web site to check and see if the organization is listed.
If it is not, and you still donate the vehicle to this organization you will not be able to claim the deduction on your tax returns. So, if receiving a deduction on your tax returns for a vehicle donation is important to you make sure the charitable organization is listed with the IRS. IF not, then choose another organization.
After you have the information that the charity is indeed listed with the IRS, you might want to talk to the charity about their plans for the vehicle after you donate it. Since you are making the donation you have the right to ask what their plans are to see if it coincides with your beliefs and wants. If not, then you have every right to donate your vehicle to a charitable organization that will use it in the way you see fit. Frequently, charitable organizations fix up and auction off vehicles in order to raise money for the charity.
Also, sometimes vehicles are maintained by the charity for use by poor individuals the charity helps. Whatever the case, ask and find out what plans the charity has for your vehicle.
Before you donate your vehicle, however, you will also have to figure out the vehicles fair market value because the blue book value is not accepted by the IRS. There is an IRS guide to help you determine the real value of your vehicle including any accessories you have added and the actual condition of the car.
You will also need to learn about your state’s laws governing charitable contributions of vehicles. Most likely, you will simply need to remove the license tag and have the title transferred to the charitable organizations name.
If you still have questions regarding donating vehicles to charity and claiming the donation as a deduction on your taxes then you should talk to an IRS representative in order to get your answers cleared up.
Finally, when you donate a vehicle to charity you are doing a good deed. However, there are some organizations that call themselves charities that really take advantage of donators, so do some research before you make your donation to make sure the people that really need it benefit from your donation.
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