| The IRS has changed the regulations on donating | | | | the exact dollar value the charity receives when it |
| vehicles to charities. If you donated a car last year, you | | | | resells the vehicle. Put another way, you can no longer |
| need to read the following to understand the new | | | | claim the blue book value of the car. The IRS wants to |
| rules. | | | | know what it was really worth, not what it would be |
| Giving Your Car to Charity - The New Tax Rules | | | | worth if you hypothetically repainted it, got new tires, |
| Millions of people donate cars, boats, RVs, motorcycles | | | | rebuilt the engine and so on. |
| and many other forms of transportation to charities | | | | Charitable organizations are more than aware of the |
| each year. While doing a good thing is one motivation, | | | | new regulations and they will more or less take care |
| reaping a sizeable tax deduction is also a motivating | | | | of everything for you. To donate a car, you simply |
| factor. Unfortunately, the IRS has concluded that more | | | | arrange for delivery to the charity. The charity will then |
| than a few people were deduction very optimistic | | | | resell the car at some point in time. The organization |
| values for their cars. Instead of auditing everyone, the | | | | will then will send you correspondence detailing the |
| IRS simply changed the deduction rules for vehicle | | | | gross proceeds from the sale of the vehicle. |
| contributions to charity. | | | | This correspondence should, but is not required to, |
| If you donated a vehicle of any sort to a qualified | | | | come to you as Form 1098-C. Yes, another form. |
| charity, but claimed less than $500 as a deduction, you | | | | Simply take the deduction for the gross proceeds on |
| can stop reading. The rule changes don't apply to such | | | | Schedule A and attach the Form 1098-C to your tax |
| situations. If you are claiming a deduction in excess of | | | | return. If the charity sends you a written letter, attach |
| this amount, read on. | | | | that to your tax return. |
| The new IRS regulations are pretty simple to | | | | While the above may sound overly burdensome, it |
| understand. If you donated a vehicle to a qualified | | | | really isn't. |
| charitable organization, the amount you can deduct is | | | | |