You can get rid of a vehicle by donating to a charity.There are charities that accept used vehicles.Any vehicle that is used on roads, highways and public streets may be used for tax purposes.You should check with the organization you are donating to for advice on the specifics of donating a boat or airplane, as they may vary slightly from an automobile.You should schedule a time for a pickup when you call one up.The rules for a tax write-off are not easy to understand.If you want to give your car to a charity, you need to have it appraisals.
Step 1: Find a charity.
If you want to give your vehicle to a charity, you need to identify it.You can check the charity's website to see if it accepts vehicles.There is a phone number to call or a website dedicated to explaining the donation process.You can use the donation wizard website.The donation process can be started on this website.
Step 2: If the charity is a nonprofit, check it out.
If you want your contribution to be tax deductible, this is important.Some charities and religious organizations can be classified as 501(c)3 charities.You can double check by using the EO Select Check tool.Churches will not be listed in the IRS directory.To check nonprofit status, you can call toll-free.
Step 3: Tell us about the vehicle.
You can give the charity information about the vehicle.When you call, keep in mind the following information: vehicle make, model, vehicle identification number, current mileage condition, and last driven.
Step 4: Required paperwork needs to be completed.
Depending on your state, the paperwork you need will be different.Check with your state's Department of Motor Vehicles.The certificate of title is required in most states.The agency that picks up vehicles for the charity will have a certificate of title for you to fill out.Habitat for Humanity uses "Advanced Remarketing Services", so their name is on the title.You have to sign the certificate of title with your name on it.Before they pick up the vehicle, the charity will probably ask you to submit the title.
Step 5: If it's necessary, have the vehicle checked out.
If you want to claim a tax deduction for more than $5,000, you need to have the vehicle appraise.You should estimate the value of the car and talk to the charity to find out what they intend to do with it.If the charity wants to sell the car, you don't need an appraisal.The sale price is proof that the car is worth something.The charity could use the vehicle, make a repair, or give it to a needy person.It's a good idea to have an appraisal done by a certified one.
Step 6: You can schedule a pick up.
You will schedule a pickup if your vehicle is accepted.If you are home, you can handle any issues that may arise.The charity has three years to sell your vehicle.You should get an acknowledgement letter after the vehicle has been sold.Hold onto the letter.Information about the sale can be used for tax deduction.You could get Form 1098-C from the charity.
Step 7: You must surrender your license plates.
There is a process for transferring ownership of a vehicle in each state.You can use your plates with your new car.Drop them off at your state's Department of Motor Vehicles if you want to surrender them.
Step 8: Do you want your taxes to be itemized.
You have to claim the charity tax deduction for donating a vehicle.You can claim a standard deduction instead of itemizing deductions.You should check to see if you want to itemize.
Step 9: The vehicles that qualify for a tax deduction are listed.
The IRS defines a vehicle.If you donate a boat airplane, for example, you can claim a tax deduction for it.
Step 10: How much do you have to deduct?
Take out your letter from the charity.The charity did something with the vehicle.If the charity sold the car for $500 or less, you can claim either the fair market value or $500, whichever is lower.You can only claim the amount sold if the charity sold the vehicle for more than $500.You can claim the fair market value of the vehicle if the charity uses it.You can claim fair market value if the charity gives the vehicle to a needy person or sells it for less than the market price.You can claim fair market value if the charity makes a material improvement.Cleaning or routine maintenance is not a material improvement.Replacing an engine is a major repair.
Step 11: Find the vehicle's market value.
The fair market value is the amount the car would sell for in a transaction.You can use a pricing guide to determine the value.The value for a car of the same make, model, year, condition, and similar options or accessories must be found.The fair market value cannot be more than the amount listed in the pricing guide for a private-party sale.For individuals, the standard deduction is $6,300, for head of households, and $12,600 for married couples filing together.You could get a standard deduction for your car, but the amount you can deduct may be less.If a charity sells a car for $1,000, this is less than your standard deduction.You might be able to take other deductions, such as donations to other charities, which will total more than the standard deduction.
Step 12: Complete the paperwork.
Attach your acknowledgement letter to your tax returns if you claim more than $500.If you claim more than $500 but less than $5,000, you need to complete Section A of Form 8283.If you are claiming more than $5,000, you need to complete Section B.Unless the car was sold, you need to include your appraisal.
Step 13: Don't sell the vehicle yourself.
You can donate the proceeds from the sale of the vehicle to the charity.The proceeds can be claimed as a tax write-off.If you want to maximize the amount that you get for the vehicle, selling the car yourself is an attractive option.Sell a used car.You need to make sure that you get an acknowledgment from the charity, which should include the name, date, and amount of the donation.