Donating Your Car To Charity? Here’s The Things To Consider

Well, most of us believe that buying a car requires more research as compared to donating a car. But, the reality is donating a car to charity requires almost as much research as we do while buying one.

The gifting of used cars to “charities” has now turned out to be a favorite way for Americans for disposing of unwanted vehicles. The main reasons behind this are that you can avoid the headache of selling or junking the car, help a charitable cause as well as lower your tax burden all at the same time.

Unfortunately, the experience is not often, in reality, such a win-win situation. Not only do charities usually see slight of the proceeds from a used car sale, but at the same time, donors can also run afoul of the taxman if they’re not cautious in advance.

Therefore, today we are going to provide you some tips that will make sure there’s a tax benefit for you and that you’re donating to a legitimate group.

If you are one of those who are searching to get information and tips on donating your car to charity, then you must read the following article until the end. You are perfectly at the right place as today with the help of this article, we are going to provide you major details regarding Donate Car To Charity. So, without wasting any time let’s get started….

How To Donate Your Car?

One of the easiest ways to donate your car is to just simply contact a charity along with arranging for it to come to pick up your vehicle. Many of the larger charities such as Habitat for Humanity, Goodwill and the Salvation Army offer committed services for this, complete with phone hotlines as well as websites with donation forms. In addition to that, there are even dedicated car donations services such as Charitable Adult Rides & Services, which also handles all of the details and also lets you choose the charity that you’d like the proceeds to go to.

If in case you’re up for a bit more work, an additional option is to simply sell the car yourself along with donating the money. In addition to that, in some cases, this can be more beneficial to the charity, since you may possibly be able to sell it yourself for even more than the charity might get at auction for it. At the end of the day, it’s all about your preference as at last it’s all your choice.

Donating Your Car To Charity? Here’s The Things To Consider

Things To Consider While Donating Your Car To Charity

While donating a car, here are some of the important things that you should consider in order to maximize the benefits to charity as well as minimize the risk to yourself.

Research And Pick The Qualifying Charity

The first and the most important thing that you have to consider is to research the charity that you are planning to give it to. If in case it doesn’t have 501(c)(3) non-profit status with the IRS, then without a doubt it is not a charity and your donation is not tax-deductible.

There are a number of organizations like CharityWatch that assess charities along with rating them for proficiency in supporting their causes.


One must also take note that in order to take a tax deduction for a car donation, you must have to first itemize deductions on your return. There are some detailed rules regarding the amount you can entitle. Taxpayers, on the other hand, can also deduct the full market value of a donated car under three conditions and those are:

  • The charity uses the car in its tasks and operations
  • It considerably improves the vehicle to sell or use it
  • The charity also donates or sells it to a needy person for below market value.

Or else, you can only take away what the charity obtains as proceeds from selling the car.

IRS Form 8283

This is very important to take note, that if the sale price or fair market value of the car is more than $500, then you have to complete section A of IRS form 8283 as well as fill it with your tax return. Consult the Kelley Blue Book, the Hearst Black Book or else the National Auto Dealers Association for market values. If in case the car is also worth over $5,000, then you should get an independent appraisal of it together with that it also finalizes Section B of Form 8283. 

Get and Dave Your Receipt And Paperwork

You must also make sure to get a receipt from the charity for the vehicle and in the end a document that certifies how much the vehicle was sold for. Charities, on the other hand, are mandatory to provide that document within 30 days of selling the car.

Drop It Off

Make sure that if the car is road-worthy, then drive it yourself to the charity that you’re donating to. In addition to that, it also saves money as well as make sure that you’re not giving the car to some unrelated, for-profit intermediate. Be careful to sign over the title of the car to the organization as well as that a representative signs it, as well. If in case someone is picking the car up, then they have them sign the title along with taking a photocopy of it. People who have been on the hook for liabilities on donated cars that were not appropriately signed over to a new owner.

Cancel the insurance

Make sure to cancel your insurance until the title is formally out of your name in order to avoid any further legal issues. Also, do not remove your license plates until the transfer is finished. In addition to that, return them with paperwork to the local DMV.

Final Verdict

In this article, we have discussed many things about Donate Car to charity to give you some guidelines and tips regarding the same. We hope that this information will be beneficial to you. I hope this article has helped you to know more about donating your car to charity. Let us know in the comments section how this information goes for you.