Car Donation: An Easy Way to Support Your Favorite Charity and Get a Tax Deduction

Most people look forward to getting their tax return, but one of the downsides to filing taxes is that you may find yourself owing the taxman come April 15. What do you do when you realize that you not only owe money, but you owe more than you can pay at the time?

The answer is: charitable deductions.

Did you know that charitable contributions are deductible from your taxes? Most people only think of donations as being cash, and giving away more cash that you don't have won't help you in this case. However, there is another option available - donate your car. Do you have an old car sitting around (even if it doesn't run) that you're not using or are having a hard time selling? If so, you're in luck! Many charities accept car donations, regardless of condition, and this contribution can be deducted from your taxes. There are a few steps you need to take in order to claim a deduction by way of car or other vehicle donation:

First thing you need to do is find out how much value you can get out of the car or other vehicle you plan to donate. Even old cars in poor condition are often accepted for donation, as they can still be sold for parts or scrap. There are sites that specialize in this kind of information, many of them free.

Find a charity or non-profit organization you believe in. It is one thing to donate a car simply for the tax relief, but find a charity that you feel strongly about to donate your car to. You won't only be helping yourself, you will be helping others that you care about.

Thirdly, make your donation - making sure that it is tax deductible. In most cases this will be the full value of the vehicle (actual market value, not Blue Book), but state laws may vary for state income tax purposes. If you have any question about this, you should see your tax advisor.

To prevent over-estimate, the IRS requires people who donate their car to produce a document from the charitable organization specifying the resale price of the car after the car is sold off. Automobiles with retail values up to $500 are exempt from this rule. In any case, make sure you get a receipt detailing your car donation. Requesting a receipt may also be necessary if you have your taxes prepared by a paid preparer.

Donating a car may sound like a big undertaking, but it's not. You can accomplish three things at once - getting rid of an old car that is taking up valuable space, helping your favorite charity, and getting a deduction on your income taxes. If you have an old car and want to reduce your tax payment, donating a car might be right for you!

For more information on car donation, please visit Car Donation For Charity and Tax Relief.

---

State Tax Information

All states also have their own tax system. Typically there... Read More

Tax Time Tune Up

Excerpted from the new book, "How to Do Space Age... Read More

What to Do If You Can?t Pay Your Taxes

The end of tax filing extensions is quickly approaching. What... Read More

Small Business Tax Credit - Americans with Disabilities Act

Many small businesses complain when confronted with the expense of... Read More

Tax Trap #1 -- Waiting to Incorporate: What A Difference A Date Can Make

NOTE: This is the first in a series of 5... Read More

How To Get An Instant Pay Raise

As a gentleman was leaving my class recently, he wanted... Read More

Employment Taxes ? What Are They?

If you have employees, you are responsible for paying a... Read More

Rearrange Your Affairs For Maximum Tax Savings

One way to maximize your business profits is by reducing... Read More

Paying Workers ? What Can You Write-Off?

As your business grows, you are going to need help.... Read More

Save Money on Taxes - Let Uncle Sam Pay for Your Fun!

"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More

Correspondence From The IRS ? Yikes!

It's a moment every person dreads. You pick up the... Read More

Business Tax Deductions

As we enter mid-March, taxpayers begin to become very interested... Read More

Seven Key Tax Deductions for the Self Employed

As a sole proprietor, it's wise to familiarize yourself with... Read More

Early Distributions From Retirement Plans

An early distribution from an Individual Retirement Arrangement (IRA) or... Read More

How Home-Based Businesses Can Avoid Giving Uncle Sam More than His Share

How Home-Based Businesses Can Avoid Giving Uncle Sam... Read More

IRS Reports Tax Gap of $300 Billion

The Internal Revenue Service is reporting that the difference between... Read More

How to Check the Status of Your Tax Refund Online

So, you were pleasantly surprised to learn that you are... Read More

Get Uncle Sam To Pay $36,000 For Your Childs Education!

Let's assume that you would like to begin saving for... Read More

How to Donate Your Car to Charity and Get Tax Deduction

Donating your used car to charity is a win-win situation;... Read More

Taxing Overseas Firms for SOX Compliance

The Sarbanes-Oxley Act, also called the Public Company Accounting Reform... Read More

I Havent Filed a Tax Return with IRS in Years, What Do I Do?

In elementary school, kids come up with creative excuses why... Read More

Estate Taxes - It Pays to Plan Ahead

Estate taxes. It's not enough to simply know they exist,... Read More

10 Tax Tips to Reduce Costs and Increase Income

No one likes paying tax. Everyone understands that tax is... Read More

IRS Obtains More Than 100 Injunctions Against Tax Scheme Promoters

The IRS has obtained civil injunctions against more than 100... Read More

Tax Reduction Tips

In the rush to get tax returns prepared and filed... Read More

What is a Federal Tax Lien?

A Federal Tax Lien (FTL) is a legal instrument that... Read More

Tax Jokes and Quotes

Do you realize that some tax forms ask you to... Read More

Hurricane Katrina ? How To Use Your Business Loss To Get A Refund on 2004 Taxes

With the massive losses caused by Katrina, the economy of... Read More

Fraudulent Tax Shelters ? KMPG Goes Down Hard

In the largest criminal tax case ever filed, KMPG has... Read More

Insider Guides to IRS Audits!

Ever wish that, as a business owner, you knew exactly... Read More

Donating Cars To Charity - New Tax Rules

On June 3, 2005, the IRS released guidance on charitable... Read More

Identity Theft ? Impacting Your Taxes?

If your identity is stolen, your finances can quickly become... Read More

Euro Tax Haven Threat

Media reporting of a new EU savings tax directive has... Read More