End of the Year Tax Deduction Information for Your Car Donation

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For some households, a car donation may be the single largest charitable gift made during the year, or ever. This is all the more reason to make sure that the donation is being used for the greatest charitable benefit and that you can take full advantage of any potential tax deduction.

In order to take a tax deduction for donating a car, boat or other vehicle, there are a number of other things you should keep in mind. First verify that the recipient organization is tax exempt as a charity under section 501(c)(3) of the Internal Revenue Code. To verify that a charity is eligible to receive contributions deductible as charitable gifts, you can do one or more of the following. See if the organization is listed in IRS Publication 78, the Cumulative List of Organizations, which is likely to be available at most large public libraries. Visit the online version of IRS Publication 78 at http://www.irs.gov/app/pub-78/. Or, ask the organization for a copy of its tax exempt status determination letter. (Note that churches are not required to apply for exempt status, and may not have such a letter or be included in the mentioned IRS publication. A car donation to a church, however, would still be deductible.)

If the organization is a charity, you can deduct only the fair market value of your car donation. In other words, this is the price the car would sell for today in its current condition. If the used car is not in good condition and needs significant repairs, don’t believe promotional promises that claim you will be able to get “top value” for your car donation based on one of the latest published guides that show the average regional prices for various used cars. If you are claiming that the car is worth $5,000 or more, you will need to get an official outside appraisal in order to substantiate the claimed value for the IRS.

Also, if you are claiming a car donation of $500 or above, you will need to complete and attach IRS Form 8283 to your tax return. For your records, you also will need proof that you made a charitable gift. The best evidence is to transfer the title of the car to the charity and keep a copy of this document. This title change also will help you avoid potential problems that can occur if the car is somehow parked illegally by the organization or is involved in an accident or other mishap before the charity is able to resell the vehicle.

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Car Donation Wizard Joins Habitat in Haiti for the 2012 Carter Work Project

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This week, Car Donation Wizard joins Habitat for Humanity again on the 29th annual Jimmy & Rosalynn Carter Work Project, taking place in Haiti. Car Donation Wizard hopes to help Habitat raise awareness for the state of poverty housing in Haiti, following the destruction of the 2010 earthquake. Car Donation Wizard also hopes to raise awareness for Habitat’s vehicle donation programs, Cars for Homes, which uses the proceeds from donated vehicles to help build homes locally and worldwide. Last year, Car Donation Wizard attended and helped build houses in the same community. The situation is still so dire that the Carter Work Project is returning again this year.

2012 Carter Work Project

Cars for Homes sponsored house built during last years Carter Work Project. Families are happily settling in with gardens and personal touches.

Video from the 2011 Carter Work Project:

For more information on how you can give back, visit carsforhomes.org.

Cars for Homes and Car Donation Wizard Visit the Nation’s Capital

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Habitat for Humanity affiliates in the national capital area were chosen for $100,000 matching Cars for Homes™ grant. Habitat affiliates in the capital area include: D.C., Arlington, Fairfax, Montgomery, Loudoun and Prince William Counties as 2012 partners.

WASHINGTON, D.C. (November 16, 2012) – If you live in the national capital area, now is the time to donate your car, boat, motorcycle or RV. Habitat for Humanity International chose the D.C. metro area Habitat affiliates for the annual Cars for Homes™ matching grant program.

Funds raised from the recycling of vehicles through Cars for Homes TM help Habitat for Humanity affiliates build homes in partnership with low-income families.

Habitat affiliates in Washington D.C. and Arlington, Fairfax, Montgomery, Loudoun and Prince William Counties were awarded up to $100,000 to match the gross revenue from the sale of vehicles donated to Cars for Homes™ through the end of 2012. Cars for Homes™ is Habitat for Humanity’s national vehicle donation program that provides donors an easy way to donate cars, trucks, boats, RVs and other vehicles to help build homes in partnership with local families in need of affordable shelter.

Over the last six years, Cars for Homes™ has distributed more than $12 million to Habitat affiliates in the United States, including more than $511,000 to the national capital area affiliates to help build affordable homes with local families.

“The matching grant offer gives donors an even greater opportunity to help Habitat for Humanity partner with more low-income families in the greater D.C. area” said Marcia Rundle, the director of the Cars for Homes™ program.

Vehicles donated from zip codes in Washington D.C. and Arlington, Fairfax, Montgomery, Loudoun and Prince William Counties will automatically count towards the matching grant program. If your residence is outside these areas, you can designate one of the selected Habitat affiliates to receive the cash value of your vehicle if you donate by phone. Donors may call 877-277-HFHI (4344) or visit www.carsforhomes.org to arrange for a pick-up.

As part of the promotion of the Cars for Homes matching grant program, representatives from Habitat’s Cars for Homes™ program will spend a day building with each local affiliate. Cars for Homes™ staff will showcase the local affiliate’s diverse building programs by volunteering on a new construction site, a minor home repair or weatherization project, the rehabilitation of a distressed property or in a Habitat ReStore resale outlet.

Like the Cars for Homes™ Program, area Habitat affiliates enable community members to make tax-deductible donations of unwanted goods to be used in Habitat homes or to be sold in Habitat ReStores. A Habitat ReStore is a retail outlet that accepts donations of new and used building supplies, furniture, appliances and home furnishings and sells them at discounted prices to the public. Area Habitat ReStores have diverted more than 15,000,000 tons of waste from local landfills while providing Habitat affiliates with much-needed operating funds. To find a Habitat ReStore near you, visit www.hfhi.org/restores.

Our area generates more than 5.4 million tons of waste each year. By donating an unwanted vehicle, building supplies and other household items, you can help turn waste into homes.

As part of the celebration, volunteers from Cars for Homes and Car Donation Wizard are visiting each of the capital area affiliates for a road-trip. In order to raise awareness for the program, volunteers are picking up hammers and working on homes in the capital area, showing what Habitat’s reputation for hard work and dedication can do for families in need of housing. Car Donation Wizard and Cars for Homes hope to make more people aware that donating a car or other vehicle is just one of the easy ways you can give back to Habitat for Humanity.

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Cars Homes and Tax Deductions

Cars, Homes and Tax Deductions

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By Brett Hersh – Let’s Talk Taxes , journal-news.net

The economic drought has stunted many nonprofits’ ability to serve their communities – just when their services are most needed.

As traditional donation streams dry up, charities are reeling to uncover new revenue springs.

One example of a creative, business like solution has been Habitat for Humanity’s Cars for Homes Program. This program allows for the donation of virtually any vehicle running or not – to help families obtain affordable homes and shelter. The Cars for Homes Program combines charitable giving with an extraordinary level of customer service.

Want to rid the driveway of the unused vehicle you must still pay insurance on (or – as in my case – the “oil-dripping eyesore” the Missus wants gone), help your local Habitat for Humanity organization, and get a potential tax deduction? It’s as easy as making a phone call or visiting a website.

How does it work?

Habitat for Humanity has teamed up with a company named Advanced Remarketing Services, Inc. (ARS) to collect, process and properly report all donated vehicles to the IRS and the donor. Vehicle donations (which can include boats, RVs, airplanes – even farm and construction equipment) are made by calling (877) 277-4344 or by visiting CarDonationWizard.com. Once the vehicle’s title is received, an ARS representative will be out to pick up the vehicle on behalf of Habitat for Humanity.

Does the condition of the vehicle matter?

Habitat for Humanity will accept most vehicles as long as they have four inflated tires, are in one piece and the vehicle’s value exceeds the cost of towing and transport.

How much can I deduct on my taxes?

Be aware: the tax rules regarding vehicle deductions changed a few years ago but can still result in a tax deduction for those who itemize deductions on schedule A. Prior to 2005, taxpayers could simply claim the vehicle’s fair market value (FMV) obtained from a reference guide such as Kelley Blue Book. Since 2005, however, the rules have become more strict and complex. The deduction amount allowed (if over $500) depends on how the organization uses the vehicle. The charity reports this use to both donor and the IRS via Form 1098-C, Contributions of Motor Vehicles, Boats and Airplanes.

How the vehicle deduction is calculated

Outright sale by charity: If the vehicle is sold by the charity to a disinterested third party, the deduction is limited to the proceeds from the sale. The charity reports this amount on Box 4c of Form 1098-C.

Improvements prior to sale

If the charity makes significant improvements to the vehicle (repairs that substantially increase the vehicle’s value), the donor will be able to deduct the vehicle’s FMV as of the date the contribution was made. The charity notifies the donor and IRS of these improvements by checking Box 5A and describing the improvements in Box 5C on Form 1098-C.

Sale or transfer to needy individual

If the charity sells or gives the vehicle to a needy individual, the donor will be able to deduct the vehicle’s FMV as of the date the contribution was made. This is true even if the charity sells the vehicle for less than its FMV. The charity notifies the donor and IRS of these improvements by checking Box 5B on Form 1098-C.

Significant use by charity

If the charity retains the vehicle for use in its charitable purpose, the donor can deduct the vehicle’s FMV as of the date the contribution was made. The charity notifies the donor and IRS by checking Box 5A and describing the vehicle’s use in Box 5C on Form 1098-C.

These reporting requirements apply when the vehicle’s “claimed” FMV exceeds $500. If Form 1098-C is not received, the donor cannot deduct more than $500 for the vehicle. If the donor is allowed to deduct the vehicle’s FMV, they must be able to substantiate the deduction claimed. Donors are not entitled to deduct the value listed in any valuation guide unless they can prove the vehicle’s condition warrants the claimed value.

This article shares Habitat for Humanity’s Cars for Home’s Programs and information on deducting donated vehicles (including boats and airplanes) to charity.

There remain, however, many tax limitations not included in this article. As always, please remember that this or any article does not constitute or replace the advice of a qualified professional. If you have any questions regarding your charitable giving or any other tax issue, please feel free to call our office at (304) 267-2594.

- Brett Hersh is the owner of HBS TAX and an enrolled agent with the IRS. Brett is licensed to prepare all tax returns and represent taxpayers before the IRS. He is also a trainer for Lorman Education and Dave Ramsey’s endorsed provider for accounting and tax services for the region. He can be reached at (304) 267-2594 or through www.hbsbusiness.com.

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What To Do With Your Flooded Car From Hurricane Sandy

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NEW YORK (CNNMoney) -

Hurricane Sandy flooded thousands of cars up and down the Northeast. If your car got swamped by the storm, here’s what you need to know

Call your insurer: If your auto insurance only includes liability coverage, then you’re not covered for this. What you need is “comprehensive” insurance, said State Farm spokesperson David Phillips.

If you are covered, call your insurer or agent right away, said Phillips. Insurance companies are getting lots of calls right now, so it may be a while before a claims adjuster can come out, he said, but postponing the call only slows things down more.

In the meantime, take pictures of the damage. Then do anything you can to keep things from getting worse. For instance, if your car’s windows are broken, leaving the interior exposed to more rain, you might want to cover your car with a tarp. And keep your receipt for that tarp or anything else you buy, said Phillips. Your insurer can usually reimburse you for those expenses.

Should I try to start my car? If possible, avoid starting or driving the car until it’s been inspected, according to State Farm insurance. Starting a water-soaked car risks more damage.

If the seats are dry it’s unlikely the water got high enough to reach critical components. In this case, you might be able to go ahead and crank it up if you must, said Mike Calkins, manager of Approved Auto Repair with the automotive group AAA.

What if my car’s interior got wet? Don’t think that just leaving your car windows open will dry out the car and solve your problems. A wet interior will most likely require professional help, said Calkins. Upholstery and carpeting can trap water. The carpeting, in particular, can keep moisture pressed against metal body parts underneath, possibly causing rust. Also, moist upholstery and fabric can grow mold, which isn’t just a threat to your car, he said, but a threat to your health.

If your car has any significant moisture inside, call your insurer. A good body shop will have the expertise to disassemble the interior, dry out what can be saved and replace what can’t.

“Repairing flood damage can be as extensive and as expensive as restoring a classic car,” he said.

What if water got into the engine compartment? The engine itself isn’t what you should be worried about. Mechanical components can be dried out and should be just fine. The problem is that modern cars have lots of microelectronics and those can be damaged by even brief exposure to water.

Also, various fluids — like brake and power steering fluid — can become contaminated with water. Those fluids will need to be drained and replaced.

Don’t try to dry it out yourself. It seems like an easy thing to DIY, but cars and even homes have been burned down by people attempting to dry out their wet car with space heaters or hair dryers in the driveway or garage, said Calkin. Let the professionals do it. Don’t try it yourself.

If your car is declared a total loss from the flood, consider your options. Vehicle donation, such as through Car Donation Wizard, can be a way to support the charity of your choice, in the wake of such a disaster. Car Donation Wizard works with charities like: Habitat for Humanity, American Cancer Society, March of Dimes, the U.S. Fund for UNICEF, NPR, Car Talk and many more. We take the hard work out of finding a legitimate charity to donate to because every charity we work with actually uses the proceeds from donated vehicles to continue their worthwhile missions. We accept non-running vehicles, like flooded cars; every vehicle donation is eligible for a tax deduction based on the selling price of the vehicle. In the wake of such disaster, we do not take your vehicle donation lightly. We know that your car is valuable and that’s why we hope you consider the charitable value of donating your hurricane damaged vehicle.

Donated Vehicle of the Month: 1974 Lotus Elite

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charity car donation lotus

When most people think of Lotus in the 70s, the white Esprit that James Bond drove in The Spy Who Loved Me instantly comes to mind. Yet Lotus was offering other intriguing vehicles at the time as well.

After their legendary Elan finally ended production in 1974, Lotus needed a replacement, so they introduced the Elite and sister Eclat. While the Elan featured soft curves and a small jellybean shape, the Elite/Eclat embraced a thoroughly modern “wedge” shape inspired by cutting-edge Italian super cars of the time. It was intended to bring the stodgy car maker up to date.

donated lotus to charity

The Elite was offered as a two-door station wagon. It seated four people. The rear features a large slanted glass window that opens to access rear space. The whole car is rather jarring looking. The tapered front and pop-up headlights no doubt inspired the front of the sleek Esprit which was introduced just a couple years later. But the side windows and tail end look more like an AMC Gremlin than sophisticated British car. You have to give Lotus credit for embracing an unusual design, however. There are also some nice smaller details like “Elite” spelled out on the hood and chrome-covered a-pillars.

Power came from a front-mounted 2.0-litre 4-cylinder engine that powered the rear wheels. This example is mated to a manual transmission. Though not a fast car by today’s standards, the fiberglass body helped keep weight at around 2,000 lbs and move the car ably once up to speed.

Inside, the interior is bathed in plastic, wood and furry carpeting. The center console features hazard light switch, rear wiper, defrost, and air conditioning controls.

car donation lotus

This immaculate first-year example has been owned by at least two people but has been kept in storage for the last 15 years and features only 35k original miles. The racing green paint looks flawless, and the seats and dashboard seem unusually clean and crisp.

Only 2,535 Lotus Elite were ever made until 1982, making this a very rare car in very rare condition.

It may not have been James Bond’s pick, but it might suit most anyone else just fine.

Donating your car to charity: 5 Tips

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Article by: The LA Times

Donating your car can benefit a charity — and your tax return. To maximize the benefit for the charity and for yourself, keep these things in mind:

THE FIVE

1 – Make sure you’re donating to a 501(c)(3) charitable organization if you want a tax deduction. You can look up the charity by searching its name on the Exempt Organizations Select Check at irs.gov or by calling (877) 829-5500. You can look up the group’s tax filing at guidestar.org.

2 – You get the tax benefit only if you itemize expenses on your return. Although there are exceptions, the amount of the allowed tax deduction is usually equal to the amount the charity gets when it sells the vehicle.

3 – The exceptions might allow you to deduct the fair market value of the car, which will often be higher than the sale price. Those exceptions apply if the charity uses the car itself, makes substantial repairs before selling the vehicle or sells it to a needy individual for a discount. Keep any documentation that verifies the allowed exceptions.

4 – Avoid liability by signing over the registration to the charity yourself. That way you’re sure the car won’t remain in your name, which could leave you on the hook with the DMV for fees or even with law enforcement if the car is later used in a crime.

5 – Ask to see the agreement the charity has with the for-profit company that collects and sells vehicles on its behalf. If the charity gets less than half the proceeds, you could be dealing with an inefficiently run program, Charity Navigator President Daniel Borochoff said.

Trick-or-Treat for UNICEF: A tradition of kids helping kids

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Following in the footsteps of generations of children before them, thousands of kids will go door-to-door this Halloween to Trick-or-Treat for UNICEF – helping raise millions of dollars for children in need.

The latest news on child mortality couldn’t have happened without your help. UNICEF recently reported an amazing 40% drop in the mortality rate of children under five since 1990 – from 12 million children dying each year to 7 million. We believe that number should be ZERO – and with your help we know it can be.

We also applaud UNICEF and the IKEA Foundation for a 10-year partnership that has improved the lives of more than 74 million children in India.

And in Niger, in the wake of catastrophic floods, UNICEF is responding to a growing cholera epidemic threatening already-vulnerable children.

On behalf of children around the world – thank you for supporting UNICEF.

Alisa Aydin
U.S. Fund for UNICEF

>   Set up your own Trick-or-Treat for UNICEF fundraising page

Trick-or-Treat for UNICEF

For generations, kids have toted UNICEF’s iconic collection boxes from door-to-door on Halloween calling out “Trick-or-Treat for UNICEF!” The annual tradition of kids helping kids by collecting donations, big and small, has raised more than $167 million since 1950 to help children in need around the world.

This year UNICEF’s Create-a-Character contest lets trick-or-treaters design their own collection box. Glitter, feathers, stickers – you name it! Plus, three participants will have their design featured on limited-edition collection boxes next Halloween.

And whether you are young or just young at heart, you can share in this inspiring tradition by setting up your own Trick-or-Treat for UNICEF online fundraising page.

>   Find out more about Trick-or-Treat for UNICEF, order your collection box and set up your own fundraising page now

October is Breast Cancer Awareness Month

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When you think of October, brown, ruby red, and harvest gold may come to mind. But right now, the world is awash with pink — pink for the thousands of women whose lives have been touched by breast cancer. October is Breast Cancer Awareness Month, and in honor of that, it’s time to grab some breast cancer good.

“Good,” you ask? Yes, good. Breast cancer, its cure rates and its treatment options have come a long way in recent decades, leaving those diagnosed with more options, better prognoses and increased support. Receiving the diagnosis is no less terrifying for the approximately 227,000 patients diagnosed with invasive breast cancer this year, but the many advancements in breast cancer treatment are cause for celebration.

Treatment

Three decades ago, the medical community focused on aggressive treatments and their results, but over time, they have taken a different approach. “In the last 10 years, our breakthroughs are just the opposite,” says Joseph Kash, M.D., medical oncologist at Edward Hospital in Naperville, Ill. “We now look for ways to get the same, or better, results with less aggressive therapies or procedures.”

While radical mastectomies were historically the next course of action following a diagnosis, specialists learned over time that lumpectomies resulted in similar cure rates for patients. The same is true for lymph node excisions; three decades ago, most women with breast cancer had lymph nodes removed, leaving them at risk for complications. “In last three years, the majority of patients don’t need that surgery,” Dr. Kash says. “With standard therapy alone, they do just as well.”

Testing

Today, patients not only benefit from hormonal medicines like Tamoxifen, which Dr. Kash believes contributes to increasing cure rates, but also from testing that allows for cancer-specific medication. “In the case of HER2-positive cancers, patients now receive targeted medicines,” Dr. Kash says. “These cancers are no longer considered the most aggressive and instead are more treatable.”

The Oncotype test, a gene-based test that analyzes how cancer will respond to different types of treatment, is an instrumental development that ensures patients receive the exact treatment they need. “In the past, almost everyone was offered chemotherapy,” Dr. Kash says.  “Now we have a test that provides the genetics of the tumor, shown to be very accurate, so we learn which women will do well without chemotherapy.” This means less invasive, but more effective treatment for patients.

Donate a car in support of breast cancer research through:

The Gloria Gemma Breast Cancer Resource Foundation was established in 2004. By donating your car, truck, boat, RV or other vehicle, you will help raise awareness, increase education, and generate funding for critical breast health programs that are in desperate need of being brought to fruition.
Your vehicle donation can help in the fight against cancer. Proceeds from the sale of your donated vehicle fund lifesaving cancer research, education, advocacy, and patient services programs.

Car Talk: How a Motorhome Became “Morning Edition”

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An Alaskan adventure, a grand tour of national parks and a trip down the California coast. This Coachmen Santara has been places! It’s taken Doug Van Solkema and family from Escondido, CA, all around the country. According to Doug, traveling in the camper means, “Safe travel and an incredible experience. The vacation really begins when you leave your driveway.”

“Sweetie, I think we made a wrong turn in Chicago. I don’t see any beaches.” (Flickr photo by YGX)
Now this camper is going to take all the listeners at KPBS, San Diego, to new places, too. How? It’s being turned into great radio!
That’s because Doug’s family decided to donate it to KPBS. “Over the years we have greatly appreciated KPBS and their quality programming,” Doug says. And now the $5,650 in proceeds from the sale of Doug’s camper will go directly to supporting the programming that the family has enjoyed all these years.

How was the donation process? “My in-laws suggested using the Car Talk Vehicle Donation Program. It was a very easy process,” Doug says.

Just goes to show that in-laws aren’t wrong all the time.

Can’t wait to get on the road again.