Significant Benefits for the Taxpayer and the Charitable Organization
During these tough economic times we all want to help in any way we can. You may want to donate your used vehicle to a charity of your choice to help those who are less fortunate. Donating your used vehicle is an effective way to raise money. There are significant benefits for the charitable organization and the taxpayer if, the organization is well managed.
IRS Recordkeeping and Filing Requirements
The General Accounting Office estimates 733,000 returns had a tax deduction for a vehicle donation. These donations were valued at about $2.5 billion. This reduced the taxpayer liability by an estimated $654 million. This is certainly good news for the taxpayer and also for those in need. There are a few important steps you need to take in order for this to work properly.
You must receive written acknowledgement from the organization for the donation
The donation of the used vehicle will be valued at the fair market price
You must claim the deduction for the vehicle for the year it was donated
Make sure the organization is qualified
Donations are Simple
You are able to get rid of an old car you donʼt want or need anymore. While helping a worthy cause, you are eligible to take advantage of the tax provisions that allow for the profits to be deducted from your income tax. The IRS supports the generosity of Americans who are helping their fellow Americans. This tax deduction for the donation of a used vehicle is for taxpayers who itemize their deductions. You can accept the standard deduction or itemize each deduction you have if, itʼs worth more than the standard deduction.
Many Organizations have a Program for a Charity Donation
Letʼs face it; weʼre all trying to keep our taxable income as low as possible during these times. If we can help others and have a little benefit for us too then, itʼs good for all involved. Just remember what you have to do in order to take advantage of the deduction. A few simple steps can avoid big problems later.
To learn more about IRS Vehicle Donation Programs for Charity please visit TurboTax Online. TurboTax Online will help you meet all of the IRS requirements to get the largest deduction possible.