Car Donation for Charity

There are many reasons people choose to use a facilitating or third-party service organization to manage their auto donations.  Indeed, they are often very similar to the reason a given charity might use such a third-party agent for auto donations.  When you’ve already got too much on your plate, it’s good to let a professional help out.

For consumers, it’s often a simple matter of wanting the vehicle gone because a new one has been purchased.  Sometimes it is the inherent bother and expense of hauling it away that makes people turn to professionals to handle their auto donations.

Of course, there are financial and charitable benefits to conducting such transactions yourself, but all auto donations are good ones as far as receiving charities are concerned.  Also, if using a service to manage your auto donations makes donation that much more likely, then such services serve a valid purpose.  As of 2004, nearly 70% of legitimate charities (determined to be non-profit by the IRS) used third-party agencies to manage their auto donations, though a similar amount did take their own inquiry calls.

As common as the practice is, there are some things you want to take into consideration when choosing a service to manage your auto donations for you.  For starters, you want to make sure the third-party management of auto donations actually benefits real charities.  This is often accomplished by calling the state Attorney General’s office or the state Secretary of State.

A large majority (39 of 50 states in 2004) of states require third-party agencies that handle auto donations to register with the state.  If the company you’re inquiring about isn’t on the rolls but is advertising their services in the state, an investigation will likely continue.  Feel free to ask for a copy of the legitimate list if you’re confused.  Many states carry this information online.

There are many types of charities that can benefit from auto donations.  In addition to the typical non-profit organizations as recognized by the IRS, schools, local or state governments, childcare organizations and veterans groups, in addition to the federal government itself are all eligible.  Not included as valid targets of auto donations are for-profit support groups, political groups or candidates, social clubs, co-ops, labour or agricultural groups, as well as just about any social group that isn’t covered by non-profit exemption.

Once you’ve chosen a charity and third-party agent for auto donations, you can get down to the business of actually sending the car off.  When inquiring about your vehicle a determination will be made as to whether it’s worth the effort of picking it up.  Though some charities will accept any vehicle, others are pickier about what they will or wont’ take, as some donations actually cost them money.  Those who do take all auto donations usually do so in an effort to generally encourage their donation base.

Even if your auto donation does run under its own power, it will almost always be picked up by a tow truck for liability reasons.  Whether the charity in question will be using the car as is, will repair it for sale or sell it directly on the wholesale market depends upon their needs and how quickly the turnaround on auto donations are expected.

Vehicles sold at wholesale auction, as many third-party auto donation agencies prefer, will usually generate a far lower value than you could have achieved if you sold it yourself.  This is generally important only if you believe the vehicle should be worth over $5,000.  In this case, you’ll have to get a receipt for the actual value of the car.  If it’s worth less, the “fair market value” of the vehicle may be estimated.

That said, if your car is worth less than what you paid for it, a third party group to handle auto donations may be a good choice as far as your allowable charitable deduction is concerned.  In the case of higher-end auto donations, you (and the charity in question) may be better served selling in some other manner and donating the resultant money to the charity directly.

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Technorati Tags: auto donations, car donations

Tags: auto donations, car donations

When the US General Accounting Office (GAO) issued its landmark report on charitable vehicle donation to the Senate Committee on Finance in November of 2003, over 4,000 distinct charity and non-profit organizations (NPOs) were accepting vehicular donations.  Though most of these used third-party, for-profit facilitating agents at the time, changes in tax laws for the 2005 tax season ushered in a new self-sufficiency among a smaller class of NPOs, often more closely geared towards benefiting from charitable vehicle donations.

Consider the very large field that benefited in varying degrees from the glory days of charitable vehicle donation, before government regulation stepped in and made it harder for people to take unreasonable deductions that varied greatly from the actual amount that charitable organizations actually received.  Though a large part of this had to do with some vaugery in how the law was written, it was also a consequence of a large segment of often less-than-scrupulous third-party agents who acted, supposedly, on behalf of the charities in question.

Now that one can only deduct the amount their charitable vehicle donation actually nets the IRS-approved charity, many of these third party players have left the game seeking easier marks elsewhere.  This means that many charities that relied on charitable vehicle donation for more than a small percentage of their annual budget were forced to either handle their own donations or make much stricter agreements with the companies that retrieved the vehicles for them.

As such, many of the charities that once accepted charitable vehicle donations were interested only in the money they were able to get from sales.  These include many of the more commonly known and nationally represented charities such as Easter Seals, and the Lung Association.  Indeed, medical related funds are very common types of charities that accept monies from donated cars rather than the cars themselves.

Some NPOs that accept charitable vehicle donation do so in an effort to further aspects of their social mission that include donating repaired vehicles to needy residents or using them to create a fleet of vehicles to shuttle old folks to their doctor appointments.  Sometimes the receipt of a charitable vehicle donation is tied to taking classes learning how to fix and maintain such a car, should anything go wrong (which it undoubtedly go haywire in the span of a few years given the used nature of your donation).

Like Habitat for Humanity, some charitable vehicle donation projects make part of the charitable process dependent upon the recipients and other members of the community working together to actually make the donation something useful.  Such charities with an educational and uplift mission don’t have to be schools, though other types of education are usually involved.  In this case, your charitable vehicle donation has the best chance of actually becoming a running and useful gift.

Another type of charity that can use your charitable vehicle donation doesn’t have the facilities to fix vehicles, but may have a need for a donated vehicle.  For instance, some schools have use for a vehicle temporarily, such as when the sports teams are travelling, but as soon as they’re back for the year, the car may be sold to the highest bidder.  This can include colleges and adult education, too.

One surprisingly eager recipient of charitable vehicle donation are the local police and fire department.  This is one area where a boat may actually be likely to be used for professional purposes, such as in the case of search and rescue missions.  Most police and fire departments are always on the lookout for a car that runs well enough to be used right away.

The ideal charity is one that can use your charitable vehicle donation directly rather than selling it as quickly as possible at auction.  In the case of educational missions, a car with few dents and mechanical problems can prove invaluable to those in need, even if your charitable vehicle donation is in pretty rough shape when received.

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Technorati Tags: charitable vehicle donation

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Since just about everything can be done online in some form or another, it’s not surprising that you can use online car donation services to get rid of an unwanted car and secure what might be a significant tax deduction.  However, it’s a good idea to be careful about just what sort of company you let handle this transaction for you.

Even good charities can let bad companies represent them.  This is sometimes the result of someone on the side of the charity not looking to closely into the qualifications of those actually doing the tow work and the paper work involved with selling a vehicle and reporting the proceeds accurately to the charity and yourself.  Online car donation almost always uses such services, even if the

On the other hand, the problem may be that the charity hired a service that facilities pick up and delivery with a network of independent contractors.  This does, of course, decrease the amount the charity will receive as a percentage of the car’s sale price at wholesale auction.  However, it does guarantee that you’ll be able to call a single number to initiate a donation no matter where you live through online car donation.

Regardless, you want to make sure there’s something to guarantee the online car donation service you choose is at least legitimate.  For starters, it should say what the charity is that you’re donating to.  If this isn’t readily apparent, a certain amount of this may be bad web design, though this is a common tactic used by companies that are actually illegal according to Federal law.

It is your duty when using online car donation services to check and see not only that they list a charity, but make it possible for you to check up on the non-profit, exempt status with the IRS.  Thankfully, you can look up tax ID numbers from the IRS website.  Donations made to less than real non-profit organization (NPOs) are not allowable tax deductions and can even result in an audit.

Once you’ve verified that the NPO in question is real, you may then donate to your hart’s content, though the amount of a deduction eventually garnered for the donation will often be less from an online car donation site than you might get from contacting a local charity that can use the vehicle directly.

Another thing you’ll want to keep an eye out for is an online car donation that makes you responsible for any charges.  Since you’re doing the donation, there’s no reason why you should have to deal with any sort of fees or charges.  Some unscrupulous companies will present donors with a destination charge, though there’s not a reason to pay such a charge either, especially if you find out your car is being sold rather than going out of state

Online auto donation has certainly come along way since the early days of dial up bulletin boards.  The industry got so large in the early ‘aughts that the General Accounting Office felt compelled to investigate the practice.  Resultant legislation has taken many of the smaller players out of the industry, though it continues to be lucrative enough.

Regardless, they’re not going anywhere, anytime soon.  A simple search for “online car donation” in your favorite search engine should return about a million pages of donation opportunities and information on services that can help you get rid of your extra vehicle.

It is good to know that if a tax donation isn’t very important to you, there are online car donation services that will take care of the hauling away and paperwork associated with the change of ownership as well as the sales and paperwork associated with the actual donation.  Even if your car is running, it will be towed from its current location.

You shouldn’t assume you’ll get a hefty donation from your online car donation.  Often times, the sale price at a wholesale auction are so poor that your charity may not benefit very much at all.  Be sure that the charity in question isn’t responsible if money is lost on the transaction, especially if you’re donating a car that’s not in very good shape.

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Technorati Tags: car donations, online car donation

Tags: car donations, online car donation