Donate your Car for Money: Are you considering finally getting rid of your old, filthy car that has been sitting for years outside your house? Why not consider donating your old car? Car donation offers a wide array of benefits such as being environment-friendly through recycling, contributing to charitable institutions, and additional tax incentives. Here are some important points you might want to consider when deciding whether to donate your car for cash or charity.
Donate your Car for Money
Donating a car for cash
One of the main benefits of car donation, especially in tough economic times, is receiving cash back or an equivalent incentive for your old car. Car donation allows you to take an end of the year tax deduction. How much you can write off on your taxes is dependent on the fair market value of your car, up to $500 or the equivalent of the gross selling price. Largely due to abuse of the system, current regulations state that owners can no longer use the fair market value of vehicles more than $500. If your car is worth less than $500, you can safely deduct the Fair Market Value in the Kelley Blue Book or NADA guides.
Equivalent cash for car donation
Some car donation programs offer partial cash payment to donors called spiffs. Spiffs are “gifts” given by charities in exchange for your donation. These cash equivalent payments come from the proceeds of the sale and are typically reserved for high value donations. This is a win-win proposition because the charity receives a higher contribution for their programs and you, the donor, also reap greater rewards at the same time. Some popular spiffs include hotel stays in popular resort destinations, free membership to exclusive clubs, and discounts on airline tickets. Cash and cash equivalents awarded to donors are starting to be a popular money-making scheme and this is the reason why a lot of profit driven individuals are taking advantage of it. Ensure that car donation program you choose is reputable and tax-qualified (non-profit) organization to avoid trouble with the IRS.
Donating a Car for Charity
When you donate your car to charity, you are investing in worthy causes that stand to help others. Some popular car donation programs that work strictly via charitable contribution include Habitat for Humanity and programs designed to benefit veterans who have served our country. While you will not receive cash in hand, there are tax incentives that you can reap through your charitable contribution. Your chosen institution receives a valuable resource and you receive self-satisfaction from helping others.
However, drawbacks of charitable car donation include additional (Donate your Car for Money) documentation requirements required by IRS. Of course, this all depends on the claimed value of the car. The higher the value, the more it may flag the attention of the IRS. Even still, an alternative to the extra paperwork is to sell your car and give a portion of the proceeds to charity afterwards. In this way, you can have a good documentation for your donation and still give back to the charitable institution.
Charitable car donation [http://www.donatecarscharity.info] is one of the most worthwhile ways that you can give back to others in need. Learn all the ins and outs of how to donate cars to charity [http://www.donatecarscharity.info/donate-my-used-car-for-cash-or-to-charity-organizations/] from tax write offs to getting cash for your old clunker through visiting our website.
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