Car donation programs are a great way to support your favorite charities, receive a tax deduction, and do something good for the environment. However, with vehicle values at record highs, there are more car donation scams than ever before. Today, we’re going to show you how to avoid car donation scams.
1. Do your research; don’t get duped by the easy button
If you search the internet for the term “car donation”, the first results and answers are normally not in your best interest. The search term “car donation” is one of the most expensive terms in all of Google search. The search results page is filled with fake locations on maps and fraudulent charities. Don’t take the easy route and select the first car donation program that appears. Do your homework and scroll past the ads.
2. Choose a charity you know and a brand you can trust
Almost any legitimate charity will accept your car in some fashion and you should look at these first. A charity should be recognizable to you by the work that they do in your community and in the world. Don’t fall for catchy jingles or billboards. You should avoid cute names and sound alike organizations that use terms like “National Cancer Society” rather than “American Cancer Society”. Scammers will masquerade as legitimate organizations, so if you intend to donate to a ‘wish’ organization or a ‘kids’ charity, be wary. The organization may not benefit that charity directly and they will go a long way to pretend that they do. In many cases, there aren’t any kids at all or there are very few wishes being granted.
3. Ask what the charity will receive
This is an important step that many ‘sound good’ organizations try to avoid answering. Be sure to ask about the percentage of gross proceeds returned to the charity program. The California Attorney General has an in-depth report for the year ending which discloses that charities typically receive less than 40% of the gross dollar back. If the charity can’t promise a bottom line return of at least 70% of gross, run away fast. Don’t settle for an answer about net percentage, look for the gross return. We are very proud that our Car Donation Wizard program returns 80% of the gross proceeds, the highest of any vehicle donation program!
4. Find out who else benefits
Very few charities run their vehicle donation program themselves. And they shouldn’t- as they should be focused on delivering services, not being an automobile dealer. However, this is an area of danger. You should be aware of all the players. For example, donations to your favorite nonprofit radio station are often a donation to a completely separate organization or even a religious nonprofit. Organizations may promise gifts or vacations in exchange for your vehicle. Be wary of these, as few legitimate charities will operate this way. Is the program run primarily by an auto auction or dealer? If so, it’s likely not in the best interest of the charity. Ask them how and where the money will be spent. Be aware of the difference between spending on programs and marketing. There are many private or hidden benefit arrangements within the car donation space. Be careful of who you’re dealing with.
5. Sign your title directly to the charity or their agent
When you donate your car, you’ll need to carefully transfer your car title to avoid liability issues down the line. Don’t leave the title blank. You need to sign the charity or agent as the buyer. If you need help on signing your title, Car Donation Wizard offers state specific title help on our website.
Legitimate Car Donation Programs
Before you decide to donate a car, be sure that the charity is an organization you know and trust. There are hundreds of car donation programs that make heartfelt appeals for your car donation, but only a small percentage of these actually benefit the charity. Use Charity Navigator to find a nonprofit that supports a cause close to your heart. Once you decide on an organization, be sure to ask how much of the gross proceeds will be returned to the charity.
Here are some nationally known and trusted charities that accept car donations:
- Habitat for Humanity
- American Cancer Society
- Special Olympics
- Car Talk Vehicle Donation Program
- PetSmart Charities
Is it Better to Donate My Car or Sell it?
Selling your car is a quick and easy way to get cash for your car. If you’re looking to earn some extra cash to buy a new car, You Call We Haul will help you get the most cash for your junk car. However, donating a car has a range of benefits including:
- A positive impact on the environment. 75% of an automobile can be recycled. The majority of vehicles that are donated are end-of-life vehicles which are sustainably recycled.
- The highest return back to your charity. Car Donation Wizard proudly returns 75-80% of the gross proceeds from the sale of your vehicle to the nonprofit organization of your choice– the highest of any vehicle donation program! Most car donation programs return between 15-35% of the gross back to charity but report it as 50-70% of the net proceeds.
- A tax break. If you itemize deductions on your income tax return, it may be possible to claim a tax deduction for your charitable car donation. Donors who itemize their taxes may deduct the fair market value of any donated car up to $499. If your vehicle sells for more than $500, you can deduct the full selling price.
Tax Benefits of Car Donation
Donors who itemize their taxes are eligible to receive a tax deduction when donating a car to charity. If your car donation sells for less than $500, you can deduct the fair market value of your donation up to $499. Visit Kelly Blue Book, Edmunds, or NADA Guides to determine the fair market value of your vehicle. If your car is sold for more than $500, you may deduct the full selling price. After your vehicle is sold, you’ll receive a vehicle donation receipt for tax purposes. Remember: companies that promise goods or services in return for your car donation are cutting into the amount you can claim on your tax deduction!
Donate a Car Using Car Donation Wizard
If you’re looking to donate a car and want to be sure your car donation makes the greatest impact, Car Donation Wizard is here to help. All car donations through Car Donation Wizard uphold the true values every donor should expect from their vehicle donation program. Car Donation Wizard is the legal agent for reputable, legitimate 501(3)(c) charities who use the proceeds of your vehicle donation toward their actual cause or mission. We provide full transparency along each step of the car donation process, which lets you avoid car donations scams.
Car Donation Wizard accepts all car donations, trucks, motorcycles, boats, snowmobiles, trailers, and RV’s. We love to feature donor stories and selfies on our Facebook and Instagram pages. To date, we’ve proudly raised over $200 million for our charity partners. Car Donation Wizard returns 80% of the gross proceeds from each vehicle donated back to the charity – that’s more than any other vehicle donation program can say! Visit us online or call us at 877-957-2277 to learn more about the charities we work with. Let Car Donation Wizard make your vehicle donation experience a positive one!