Obtaining the Right Value or Fair Market Value When You Donate Car

To donate car is the best way to gain tax deductions at the end of the year. Even the IRS has made it easier to donate car in the recent past to benefit those who benefit others in need. As IRS would encourage you to donate car to balance the socio-economic spectrum, they make it easier to calculate the final sales value of your car. The final value of your vehicle is the final tax slash you get.

You will neither need to show something above nor below the value of your car by means of some percentile calculations on how much it is sold for. Either a final receipt for which the car is sold or a preliminary receipt – as acknowledgement after you donate car – will help you gain the tax cut. If sold for less than $500, your preliminary receipt given by the charity or the program to which you donate car will be sufficient. If it gets sold for more than $500, this latent receipt will cut your tax down to the final value.

Suppose, if your vehicle is not sold at all, and if retained by the charity for its own daily use, the usage of which must be of significant value to the charity, and if they had to perform some major repairs on your vehicle, the value of your car will be based upon the fair market value. Before you donate car, you can get an idea of the fair market value by special publications that list the prices for each type of vehicle, year the model was launched, price at which dealers buy a particular model, etc.

The rates are not mandatorily the same as published but they act as a certain point of reference to gain some ideas on the approximate value. The mileage also plays a crucial role in determining the fair market value of your car. Besides the mileage, special features, if any, such as sunroof, upholstery, ABS air bags, power windows etc. need to be mentioned. When you donate car, the value is also determined by the exteriors and the interiors. How it works mechanically matters a lot more than the two previous factors. Finally, a few snaps of your donated vehicle will be useful when you donate car to gain tax deductions.

The program to which you donate car will take care of other nitty-gritty details in filing IRS forms, verifying and sending you and the IRS, copies of the requisite forms. Though it all sounds complicated, the programs to which you donate car will make it a lot easier for you.

Objectives of Vehicle Donation Program

A Vehicle donation program has its own objectives of funding causes such as education, medical supplies to the poor, wartime rescue efforts, feeding underprivileged children, etc. The car or truck you donate in the vehicle donation program might help someone get education, food or work. A car donation program works with a stated purpose of funding some causes that might benefit a large number of people.

A vehicle donation program is defined by its objectives and the organization on whose behalf the car donation program is conducted for. From education to feeding the poor, the spectrum ranges from using an automobile to deliver medical supplies to transporting children in charities. Vehicle donation programs might also benefit students, unemployed and homeless individuals.

Those who conduct vehicle donation programs facilitate the charity organizations to gain funds by virtue of car donation. The charity does not have to decide on what to do with cars and how each automobile has to be sold in order to gain the maximum funds. Car donation programs take care of these processes, since they are specialized in conducting such programs.

The experts at vehicle donation programs have another objective too, which is to gain tax deductions, without fail, to those who offered their cars to the car donation program. They offer the right documents and support in picking up cars, offering the right forms for tax deduction and help you gain tax deductions to the total value of the car. A vehicle donation program assumes tax deduction to donors as one of its objectives and works seriously towards getting them the tax deductions.

Beware of Car Donation Scams

Car donation is not merely about offering your car and to forget about it for the rest of your life. Car donation scams may happen when you personally don’t take much care on where your automobile goes and who gets it. Besides that, people can take advantage of you when you do not have adequate knowledge on something like car donation. Be armed with the knowledge on how to avoid scams which you will find very useful.

Here are a number of ways to avoid scams in car donation. Since it is all about money, scams are bound to happen. You can ensure that they do not take place with the help of a little knowledge on car donation:-

1) Ensure Legitimacy

Legitimacy of the charity organization is the most important thing to look at. Ensuring that they are really a non-profit organization will mean the resource rightly used to benefit those in need. Only legitimate organizations will also qualify you for tax deduction.

2) Enquire and Follow Up

Car donation scams take place when you donate a car and leave it at the will of those concerned to use it to their advantage. Amidst all your other chores, you could find it appropriate and as a sense of responsibility to follow up with what is done to your car. Before getting involved in the car donation program, you can enquire them as to how it will all turn out to help others.

3) Smell a Car Donation Scam

You can smell or sense scams by the exaggerated statements that accompany such programs. They might trick you into believing what will not be carried out in the future at all. Remember, tall promises are always false promises!

Why Donate Car When You Can Donate Money?

Have you ever wondered, “Why donate car when you can donate money?” When the latter is an easy option, the former has some procedures, nevertheless taken care of by the charity to which you donate car. Are there enough reasons that justify why we offer automobiles instead of money? Here, the word “reasons” implies the benefits both you and the charity can obtain through the offering of your vehicle to charity.

The first and foremost benefit is tax exemption to the final sale value of your car. It is a tangible benefit that adds up to your financial status at the end of the financial year. Of course, even if you offer money, you still can gain tax exemption but besides the tangible benefits, the intangible benefits are based on utility, when you donate car. The utility of a car is higher than that of money.

When you donate car, the utility of the vehicle varies from sales to fetching to ferrying to commuting to work. If the vehicle is sold to or offered to a family in which one of the members has a job, they can use the car to travel to and fro to work. If it were sold to or offered to a student, he can use the automobile to go to his college, if he were to travel a long distance each day to get educated.

You can also donate car to put to use what you wouldn’t otherwise need. Somebody else may be in need of what you no longer need. You can offer money but when you donate car, you put the machinery into productive use. Hospitals can use them to fetch medicines while charity organizations do so to transport the children or the aged. A vehicle is about multiple utility while money can only help purchase something which is why you can donate car in place of money.