This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Donate A Car -- The Right Way

More than a million Americans donate cars to charities every year.

December is decision time. Donations must be made by Dec. 31 for you to make use of any tax benefit next April. A little planning will not only mean a greater tax deduction but a better chance your old car will be put to good use. It also means you have the time to properly sever your car insurance and registration.

Select an approved charity -- an IRS-recognized 501(c)(3). Consult IRS Publication 4303, "A Donor's Guide to Vehicle Donations," as well as its charitable organizations page, which offers a way to search for tax-exempt organizations.

 Double-check your choice at the Better Business Bureau's National Charity Report Index, which tracks 20 different accountability standards, or CharityNavigator.org, which rates 10,000 charities according to their financial health and transparency.

Contact the charity. Ask if the charity will resell the car for cash, offer it to a needy family or keep the vehicle for the organization's daily use.

A vehicle that is resold for cash (that is, most of them) is deductible only on the sale price of the car, rather than its fair market value. If the charity gets only $800 for your $2,500 Ford, you can deduct only the $800. But if the charity uses your car in its daily operations, for things such as deliveries, you can deduct the full fair market value.  Some charities offer vehicles at a discount to families who are rebuilding their finances; in those cases, the deduction can be taken at the higher amount.

 Get a receipt from the charity. The charity is required to send a notice of sale within 30 days advising you of the car's sales price.

Terminate your registration and insurance coverage. Don't just sign the title over and let your insurance and registration lapse, says CarInsurance.com consumer analyst Penny Gusner.

“The state may see in its records that you have a car still registered that is without insurance and penalize you for that,” she says. “And if the vehicle is in a crash or impounded, as legal owner you are going to be looked at.” 

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

Chart of I:DJI
DOW 17,568.53 -127.94 -0.73%
S&P 500 2,079.65 -12.01 -0.58%
NASDAQ 5,088.63 -48.8540 -0.96%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs