What is a car donation and what are some of the benefits of a car donation?

A car donation is great way of helping out a community or national charity whose charitable work efforts you support. When you donated a used car to a charity, you can enjoy that knowledge that you are supporting the charity’s cause as well as avoid the hassles and headaches of selling a used vehicle. You will also benefit from the tax deduction and tax benefits from the used car donation. Most car donation charities can arrange for free pick up of the vehicle that you want to donate.

What types of vehicles or items are accepted?

Car donation charities will accept cars, trucks, boats, motorcycles, motorbikes, vans, helicopters, water-crafts, RVs, and trailers. Car donation charities will also even accept things such as lots of real estate. In general, they will accept just about any type of donation as long as their costs of picking up the donated item and processing of selling the item do not exceed the actual value of the donation.

Does the condition of the car that I want to donate matter?

Well, it is obvious that the better the condition of the car being donated is, the more money the car donation charity can get toward its charitable work when it goes and sells the vehicle. That being said, car donation charities will generally accept any condition of a car donation (running or not) as long as the costs associated with picking it up and selling it do not exceed the value of the vehicle donation.

What does the charity actually do with the car donation?

When some people envision making a car donation or vehicle donation, they picture the workers or beneficiaries of the charity actually using the car. In general, this happens only in a small percentage of car donations where the worker or beneficiary has extreme need for using the car. Almost all car donations are sold off at auctions or sale events so that the charity can get the money and use the money in charitable work efforts.

Some car donation charities have their own facilities and services to processing and selling any vehicle donations that they receive. Other charities (often the smaller ones) have to employ other companies or outside services to sell the vehicles for them. This will usually result in the charity having to pay the car donation processing company for their services and being able to use a smaller percentage of the car donation value toward actual charitable work.

How do I make sure that I receive the full tax benefit and write-off for my car donation?

The first step is that you have to pick a car donation charity that is classified by the US IRS as a 503(c)(3) non profit organization. It should be fairly easy to check about this status with any of the car donation charities and easy to verify with the IRS. Then, when you make the actual vehicle donation, make sure the charity gives you the proper receipt and documentation for acceptance of your donation, especially if the value of the car being donated is over $250. If the value of the car donation is over $500, you will also need documentation from the charity for the exact sale price of the vehicle later on in order to be able to claim your tax benefit for that amount.

What documents or items should I prepare in preparation for a car donation?

You should make sure that the vehicle or car that you are donating has a clean title and prepare the documents and title ahead of time. This will make the vehicle title transfer much easier and smoother for both parties. If you cannot find the proper title or documents for the car donation, be sure to notify the car donation charity ahead of time so that they can have someone work through the extra paperwork with you. In general, they will handle all the paperwork for transferring and donating the vehicle for you.