Car Donation

When you're choosing amongst charities to donate your used cars to, there are a few factors to consider.

One, if you're looking to donate a used car that “makes the biggest difference”, you should look at the particular car donation charity. For example, while the American Lung Association provides smoking cessation programs, asthma counseling, and lung cancer research, the $50 - $100 that your junk car might earn for them is a relative drop in the bucket as far as car donation charities go.

On the other hand, small local charities such as food pantries and shelters can turn your used car donation into weeks of food or shelter for people struggling in the current economy. Choose a charity that works for you, and consider what your car donation will mean to them.

Second, many people are looking to turn their car donation into the largest tax deduction possible. Tax laws passed in 2005 have meant that most car donations end up producing a $500 Federal tax deduction. If you have an “extra” car to donate, and it's worth considerably more that $500, you need to find a car donation charity that is equipped to provide you with a receipt of sale that establishes fair market value.

It's not uncommon for people to donate cars that may be worth thousands of dollars when auctioned for charities. If you're seeking to get the largest tax deduction possible for your car donation, be sure to ask your charity how your car will be disposed of, and whether you will be able to receive the necessary documentation to claim your tax deduction.