A donation can be given to a charity in various forms. These include vehicle donations. The charity may either use the vehicle to carry out social work or sell it to someone who needs a vehicle at a reduced price. There are multiple donation websites in the market, but most of them come with caveats. If you plan on donating a used car to charity, consider these things before you pick a reliable organization.
Look for organizations that have 501 (c) (3) non-profit status
Multiple organizations may claim non-profit status. But if you want tax deduction on your donation, you should give your car to a registered 501 (c) (3) organization or tax-exempt religious institution. You can verify if a charity has 501 (c) (3) status by contacting the IRS or visiting their website.
Ask for a receipt and take pictures
Charities need to provide a receipt of your donation within 30 days of selling the car. When you receive the receipt, check the document for the price at which the vehicle was sold. You must also take pictures of the car and maintain receipts of repairs when you drop it off, especially if you’re claiming a tax deduction. Based on the purpose of the donation, the charity will also give you a receipt or a Form 1098-C, depending on the value of your vehicle. This document will serve as information for filing taxes or future references.
Drop off the car and sign off
Dropping off the car yourself will ensure that your vehicle donation does not go to someone who may use it for their own profit. You should also sign over the title of the car to the organization after dropping it off. Ask the representative to sign the document as well. If the vehicle is not properly signed over, you might be held accountable for future parking tickets and other fines.
Avoid for-profit intermediary organizations
Multiple for-profit intermediary organizations advertise about car donations. But these organizations may keep a percentage of the money as commission when they sell it to a non-profit. Therefore, if you are considering a car donation, look for organizations that can handle the transaction directly. This way, the charity can keep 100 percent of the profits and use the money for social causes.
Reliable car donation charities
Here are three reliable charities if you’re looking to donate your vehicle.
American Diabetes Association (ADA)
This non-profit is focused on helping patients with diabetes and preventing the condition. When you donate your car to the American Diabetes Association, they will sell the vehicle at an auction or recycle it for the value of its scrap metal. The proceeds go towards funding the organization’s outreach programs. ADA accepts many types of vehicles, including trucks, cars, boats, trailers, motorcycles, RVs, and jet skis.
Charity Motors
Charity Motors will pick up your vehicle for free and offer the highest tax deduction value. The organization also provides a 50 percent subsidy to low-income car buyers. Charity Motors will then donate a high percentage of the proceeds to a charity or church of your choice.
Habitat for Humanity
Another reputable charity is Habitat for Humanity. The non-profit organization is dedicated to providing housing for the needy in the country and worldwide. So when you donate your vehicle to the charity, the proceeds help fund programs that involve purchasing materials to build or repair homes for families with limited income.
