Car Donation Tax Breaks

Written by Johnny Kitchens
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Giving to charity is one of the most fulfilling things a person can do. Not only does it give the charity the funds to keep performing their good works, it gives you the benefit of knowing you are helping to make those works possible (an intangible benefit but a definite one.) In the case of donating a car or truck, the benefits extend to the person who purchases the vehicle at auction. Buyers can usually get pretty good deals that way.

Aside from the receiving the warm glow of giving, you also get a tangible benefit in the form of a sizeable tax deduction. Your deduction is tied to the current fair-market value of the vehicle being donated not the price for which the vehicle eventually sells. There are any number of resources (both online and in traditional publications) available to you where you can find that value. Any tax professional local to you should be able to give you more specific information.

You might also be able to deduct the expense of any repairs you make to the vehicle in preparing it for donation. Charities can usually only accept vehicles that are running so if you put in a new battery and replace a flat tire, you might be able to include those expenses in your deduction. Of course, you will have to be able to prove that the repairs were strictly for the donation and that you received no benefit from them. Again, your tax professional should be able to help you with this.

What You Need to Take the Deduction

If the IRS never asks, the point is moot. However, just in case they do, you should receive a formal letter of receipt and thanks from the charity that received your donation that will serve as proof for tax purposes. You should receive this letter in a timely fashion and you may have cause to be wary if it is not forthcoming. In such cases, you might consider withholding the title until it arrives. Such precautions can help ensure that your donation is actually going where you think it is going.

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We know that charity begins

We know that charity begins at home. Giving away charity is a noble work and the charity which is received the poor people and it helps them a lot in their financial crisis. When we donate a car or bus we not only help the person but also we help his family also. The people those who could not afford a car due to their monetary problem would be benefited through this. As in auction it is a lower price than the original price. And the car don't require any quick maintenance as the owner have already maintained it.