Legal Donation

How to write of a car donation on your taxes

Published at 02/26/2012 19:10:47


Most people get either excited or upset at tax time. Those who are not getting much back may be searching for extra tax write-offs. For some people, making a car donation is the perfect way to do this. By donating a car, you are giving a car to someone who is really in need and you are also getting rid of clutter in your garage.

You can donate cars, RVs, trucks, SUVs, and any type of motor vehicle (motorcycles, boats, and off-road vehicles, etc.).


Step 1

You need to determine how much you will benefit by doing a car donation. The best thing to do would be to consult a tax professional who can give you a good idea of how much of a write off that you will actually receive off your taxes. This small tax break may been all that you need to put you under making a certain amount of income to be in a higher tax bracket. Thus, you will have more taxes withheld from you when you file.

Step 2

Once you have decided if it will or will not benefit you, gather all important documents for the car donation for the vehicle. This would include the proof of owner ship for the vehicle such as your registration card and renewal notice. They may also require your certificate of title, insurance card, VIN number of the vehicle and licenses plate. Once the car is being picked up they may also require other proof of who your are such as your driver's licenses and proof of address, such as a water bill or a piece of mail that verifies you are the one who lives in the home.

Step 3

Find a good company who is legit and you know is actually going to give the car for a charitable purpose. The company should always be a registered 501(3)(c) charity. Ask family or friends if they have donated, who they donated to and how the whole process went.

Step 4

Word of mouth is always the best policy when it comes to something, especially giving away something if value, such as a car donation. Some companies will even let you share the proceeds with a charity of your choice. This would all be explained to you upon speaking to someone who works for the car donation company.

Step 5

Once the car donation company has your car, they will make any repairs as needed and list the car for sale. A percentage of the proceeds from the car sale will go to charity and the company keeps the rest for their overhead cost such as the towing and maintenance they did on the vehicle.


When working with a car donation company, check with the Better Business Bureau, and make sure they are a legitimate company with a good rating. If now, then move on to another company who is.


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