Donating a Car

General Vehicle Donations Tips

Donating a vehicle to a charity is a noble gesture, possibly financially rewarding gesture, but potential donors should be sure to do their homework first.

To begin, find out as much information as you can about the organization you're intending to use.

• What percentage of the sale that goes to the organization?

• What do they intend to do with the vehicle?

• Does the charity qualify as a tax-exempt organization?

Unfortunately, scams are common in the vehicle donation field. To make matters worse, they can be hidden anywhere along the line, including within the charitable organization, the organization re-selling the vehicle, or even the towing company.

Considering this, it's a smart move to check with the Better Business Bureau and other consumer agencies to see if the organization has a favorable track record.

While donating a vehicle could result in a significant savings on your taxes, the tax laws concerning vehicle donations are complicated. Check with the Internal Revenue Service on the matter, or download the agency's vehicle donations publication.

Consulting with an accountant or a tax professional is also a good idea.

Transaction Process

Remember to remove the tags from your vehicle before donating it. Then, take the tags to a Department of Motor Vehicles (DMV) service location to cancel them. Doing so frees you from any liability charges or traffic infractions that might arise after the vehicle is no longer in your possession.

You may also return the plates to:

• D.C. DMV

• P.O. Box 90120

• Washington, D.C. 20090

Also, be sure to transfer ownership of the vehicle to the charitable organization by assigning the title.

Charities

The IRS's Publication 78 lets you search for qualified charities. Or call the IRS Customer Service Accounts Services Division for Tax Exempt and Government Charities at (877)829-5500.

Remember that many religious organizations are not listed (they're not required to apply to the IRS), but still qualify.