How to Donate Your Car to Charity

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In cities across the U.S., public transportation is unreliable. For people without cars, that can mean no access to work, school, or other locations. Donating your car can be a wonderful way to help someone improve their situation.

Step 1: Research charities
Research charities that accept car donations. Make sure you do some leg work to find a reputable charity. You can do a lot of this research online. A good way to find out a little about the charity is to contact the Better Business Bureau. There are several options, especially in large cities like New York, New York and Los Angeles, California.

Tip
When looking for a place to donate your car, avoid using intermediaries, who might keep up to 90 percent of the donation value.

Step 2: Check tax status
Check to make sure the charity you choose is certified as eligible by the IRS so you can receive a tax deduction. Search Publication 78 on the IRS website. You can also call the IRS Tax Exempt/Government Entities Customer Service telephone number.

Tip
Deliver your car to the charity if you are able to -- it saves the charity money and time.

Step 3: Determine the value
Determine the value of your car. Use a used-car buying guide and follow their step-by-step instructions on adjusting value based on mileage and other conditional factors. The IRS has Publication 526, "Charitable Deductions" and Publication 561, "Determining the Value of Donated Property," which help assess a fair value.

Step 4: Keep good records
Keep good records of your donation. If your car is worth $500 or more, fill out IRS Form 8283 and attach it to your tax return. Keep all of your receipts and other information organized and easily accessible.

Step 5: Pay attention
Pay attention to all the details of this transaction. Not only will your donation be a huge help to someone who needs it, it will also provide you with a tax deduction. It often does pay to help.

Did You Know?
In 1960, the Bureau of Transportation Statistics calculated that there were more than 74 million registered vehicles on the road. This includes passenger cars, motorcycles, trucks, and buses. In 2007, the number shot to more than a quarter billion.