Donating a car to charity is a way to support a charity you believe in. If you have a vehicle you no longer want, your chosen charity may have a use for it, and your donation will help others. If you’d like to donate a car in Silver Spring, MD, you need to comply with the rules set down by the Maryland Motor Vehicle Administration (MMVA). These are a few of the things you need to know.
3 Things To Know About Donating a Car to Charity
Your Chosen Charity Must Be Able To Receive the Vehicle
Not all charities can receive vehicle donations. Unlike money and other forms of donations, vehicle donations require the organization to have the time, personnel, and resources to manage this type of donation. Many smaller charities would like the donation but don’t have the resources to receive it. If you’re deciding to donate a vehicle, it’s essential to check this with them.
Your chosen charity will be happy to answer any questions regarding its donation policies. Many smaller charities usually advise that if you want to donate to them, the easier way is to sell the vehicle and then donate the money to the charity.
You Can Claim a Deduction
When you donate a vehicle to a charity, they will send you a letter confirming that they’ve received your donation. To deduce the value of the donation on your yearly 1040 tax form, the charity you’ve chosen must be registered as a charity with the IRS.
The amount you can deduct depends on the fair market value of the vehicle you donate. It can determine a vehicle’s value by checking the Kelley Blue Book value and considering any work that needs to be done to the car. For example, if your vehicle is worth $1,500 and needs $200 in repairs, your car’s market value would be $1,300.
The Process Is Similar to Selling a Car
When you donate a car, you must complete many of the same documents you would if you want to sell a vehicle. You’ll need a Bill of Sale (Form VR-181); only the car’s value must be filled in as a “Donation.” The certificate of title must be completed. You fill in the section as the seller, and the charity completes the form as the buyer.
You may also need to complete additional forms for the IRS if the car’s value is between $500 and $5,000 or if the value is over $5,000. These forms are evidence to support your deduction value.
Now that you’ve donated your car, you’re sure to be looking for a replacement. Come in and see our wide range of vehicles at DARCARS Volkswagen.
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