Donating your car to charity is great for both you and the organization of your choice. You get the vehicle off your property and the charity gets the transportation they need to serve the community. If you've made this decision, it's important that you prepare your vehicle for donation. Here are a handful of tips to get you started with this process.
Research Vehicle Registration
Make sure you research the vehicle's registration. In most instances, charities sell donated vehicles and use the proceeds to fund their outreach programs. If there is an issue with the registration, the charity won't be able to sell the vehicle and will have to return it to you.
For example, if a vehicle is paid off, but there is still a lien holder listed on the title, the vehicle can't be sold until this issue is cleared up. Taking care of this beforehand simply makes the process easier. Correct any errors before initiating the donation process.
Check The Vehicle's Value
When you donate a vehicle, there is a possibility that you can make a deduction on your taxes. However, some people assume that the amount you can deduct is based on how much the vehicle is sold for. In reality, how much you can claim on your return is based on the market value of the vehicle.
In order to ensure you are receiving the maximum benefit, but also not overestimating, it's best to check the value of your vehicle. There are a number of online tools that can help you perform this step. Retain this value report so that you can include it with your documentation when you file your taxes.
Double-Check The Charity
If you're not familiar with the organization, it's a good idea to double-check their credentials. You want to ensure the proceeds from the donation are going to be used appropriately. This investigation doesn't just provide greater peace of mind, but also protection from future liability.
If you receive a tax deduction for the donation and it's later determined that the charity wasn't legal, the deduction could be reversed and you could be held partially liable. You can confirm this by requesting verification of their tax exempt status.
Donating your vehicle is a great way to help someone who is in need, which is what it's all about. Make sure you are properly preparing for this process to avoid any hiccups. For more information, contact local professionals like Action Donation Services.
