Your tax deduction will depend, in most cases, on how much your vehicle sells for.
- If your vehicle sells for less than $500, the IRS says you may be able to deduct the fair market value of your donated vehicle or $500, whichever is less.
- If your vehicle sells for more than $500, the IRS says you may be able to write off no more than the sales price. If this is the case you will receive a letter from us stating the sales price of your vehicle.
Tax Reporting Requirements:
- In order to deduct your charitable contribution you will need to itemize your deductions on Schedule A.
- If you are claiming a deduction of $500 or less, then the receipt you get from us at the time of your donation is all the documentation you will need.
- If you are claiming a deduction of more than $500-
Because everyone’s tax situation is unique, we encourage you to consult with the IRS or a tax professional to determine your tax benefit.
- You will need the letter from us stating the sales price of your vehicle, and
- You will need to complete and file tax form 8283, and
- You will need to notify us of your Social Security Number or Tax ID number because we will need to file tax form 1098-C with the IRS.
If you receive something, like cash or a vacation certificate, in return for your donated vehicle this may reduce your tax deduction, and in some cases even cause you a tax liability. This may also reduce the amount of money your charity receives.
Be wary of claims such as “Write Off High Retail Blue Book Value.” In most cases your write off will be based on the sales price of the vehicle as indicated above. In those rare instances when it’s not, the IRS recognizes the fair market value as the “Private Party” value” from such sources as Kelly Blue Book, not the “Retail Value.”
Car Donation Services, Inc
4971 Pacheco Blvd
Martinez, CA, 94553-4324