April 15 is Tax Day, the last day to submit your income tax returns to the federal government. Car Donation Wizard is here to provide you with car donation tax tips which may help your understanding of car donations and how tax deductions benefit you.
Due to the ongoing COVID-19 pandemic, the IRS has extended the federal income tax filing due date for the 2020 year from April 15, 2021 to May 17, 2021. Individuals can also postpone their federal income tax payments for the 2020 tax year to May 17, 2021, without penalties and interest.
How Much Can I Deduct?
If you donated your car in 2020 to a charity featured on Car Donation Wizard, such as Habitat for Humanity, American Cancer Society, Car Talk, or any of our charity partners, you received a tax deductible receipt listing the gross selling price for your vehicle. Any 501(c)(3) charity will provide you with a tax deducible receipt for your car donation.
According to the IRS, you are eligible to deduct the fair market value of your donated vehicle, which may be different than the Kelly Blue Book Value, as vehicle worth varies depending on the type of re-sale marketplace.
The actual amount you are able to deduct depends on what the charity does with the donated vehicle. When your charity sells the car, your deduction is limited to the gross proceeds the charity receives from selling the vehicle. If that amount is less than $500, you may be able to deduct the fair market value up to $500.
Always consult with a tax adviser or the IRS for more information on how to claim charitable deductions for your car donation. The IRS can answer your questions and provide tax forms, publications, and other reading materials for further assistance. IRS materials are accessible online, by calling (800) 829-3676, and at IRS walk-in offices across the United States.
If you have additional questions regarding tax deductions, the following links may useful:
IRS Publication 4303, A Donor’s Guide to Car Donations (PDF)
Publication 526, Charitable Contributions (PDF)
Publication 561, Determining the Value of Donated Property (PDF)
Form 8283 Non cash Charitable Contributions (PDF)
Instructions for Form 8283, Non cash Charitable Contributions (PDF)
About Car Donation Wizard
Car Donation Wizard has proudly raised over $200 million for our charity partners. We return 75-80% of the gross proceeds from the sale of your vehicle to the organization of your choice, the highest of any vehicle donation program! Car Donation Wizard accepts all car donations, trucks, motorcycles, boats, snowmobiles, trailers, and RV’s. Click here to read our blog with step-by-step instructions on how to donate your car.
Support your favorite charity by donating your car online or calling us at 877-957-2277!