Donating a Car

Missouri residents who donate a car to charity can enjoy the personal satisfaction that comes with helping a worthy cause, while potentially earning a valuable tax deduction.

About Vehicle Donations

Since many different types of organizations accept vehicle donations, it should come as no surprise that there are often different rules and regulations surrounding the process.

Some charities take any vehicle regardless of its condition, while others only accept cars and trucks with no major mechanical problems. Larger organizations may be able to help you fill out all of the paperwork for the title transfer, while smaller groups may not have the staff available to offer such assistance. Some nonprofits will come to your house and pick up the vehicle, while others have central drop-off locations.

If you're interested in donating your vehicle to charity, it's best to contact the organization directly to ask about how they do things.

Choosing a Worthy Charity

Think about your personal goals and beliefs. Would you prefer to work with a group in your community or one which helps people all over the world? Is there a particular issue that has special resonance with you, such as education or health care? Would you like to use your donation to honor someone special, such as a friend who was killed by a drunk driver?

Some of the many charities that accept vehicle donations include:

• Glaucoma Research Foundation

• Activated Ministries

• Mercy for Animals

• Outreach Center for Children

• World Vision

• National Eating Disorders Association

• US Doctors for Africa

• Heritage for the Blind

• The Breast Cancer Fund

• Youth Radio

You should always take steps to make sure the charity you've selected for your vehicle donation is a legitimate nonprofit organization. There are certain unsavory individuals who have tried to obtain vehicle donations for their own personal gain in the past. If you're interested in donating to a charity that you haven't worked with before, try using Web sites such as GuideStar and Charity Navigator to research the mission, goals, and financial health of the group.

Making It Legal

Contrary to popular belief, the paperwork needed to donate a car to charity is not much different than that required to buy or sell a vehicle. According to the Missouri Department of Revenue (DOR), the following documents are necessary to ensure a smooth title transfer when giving a vehicle as a donation or gift:

• A current safety inspection certificate

• A current emissions inspection certificate, if required in your area

• A written statement or affidavit indicating you want to transfer the title of the vehicle as a gift

• A certificate of title that is marked "GIFT" in the sale price area

You must also report your vehicle donation to your nearest DOR office within 30 days by submitting a completed Notice of Sale form.

Tax Implications

Your donation may have financial benefits to you if the charity you've selected is classified as a section 501(c)(3) organization. In this case, you may be eligible for a tax deduction based on the fair market value of the donated vehicle. To receive the full benefit of the deduction, you will probably need to itemize your deductions on Schedule A of Form 1040.

While many people assume you can credit the Kelley Blue Book value of your car when making a vehicle donation, this is not always the case. For detailed information regarding how deduction amounts are calculated, see IRS Publication 561: Determining the Value of Donated Property.

A receipt for your vehicle donation is not necessary to claim a deduction of $250 or more, but it is highly recommended. In the event that you are later audited, you will need this receipt to substantiate your deduction.

If you're not sure the charity you've selected makes you eligible for a deduction, review IRS Publication 78: Cumulative List of Organizations or contact the IRS Customer Account Services division for Tax Exempt and Government Entities at (877) 829-5500. For specific questions related to the tax implications of donating a car to charity, however, it's best to contact your accountant for personalized assistance.

DMV.ORG has additional information about the car donation process in this how-to guide.