Benefits of Donating a Car

[pgackerman]

What financial benefits does a donor receive when he/she donates a Fiero to the Club?

Can they take a blue book/NADA charity deduction that tax year?  Or do they have to wait until the Club sells the car?

[Raydar]

I certainly don't know the legalities, but I always understood that you could claim the donation (at whatever value) as soon as it's made. At least that's how it is when you donate to other charities. (Goodwill, etc.)
Not sure how to value cars, however. Clothes and stuff seem to be kind of arbitrary.
As I understand it, there is a maximum value that can be donated to a given entity each year, without documentation.
(Asking Tammy, since she's donated about a dozen bags of clothes this year, already, with more to go. Her advice...Talk to your "tax professional.") Google is probably your friend.

[pgackerman]

The question came up when a co-worker sold his 300,000+ mile Civic that had been sitting for a year for $500.  He said he would have given it to the guy for free if he'd haul it out of his yard.  And I've seen $500 and $800 Fieros on Craigslist...

So I'm wondering if:
* Someone selling a sub-thousand dollar Fiero would be willing to donate it to the Club,
* The Club would be willing to take it, and
* When the donor gets the benefit of donating the car.

Most people want to get something out of their car when they part with it and generally don't want to see the car destroyed. 


BTW, I donated a car to Salvation Army and didn't get the tax benefit until it was sold at auction.  But that doesn't mean I couldn't have taken some other benefit in some other way or that tax law hasn't changed.

I'll ask my CPA more on the 10th.

[Fierofool]

The cars that have been donated to us have been without requests for tax credits.  The 86SE donated by RobsFieros was to be a substitute for the original Joel Project.  The car eventually was found to be unworthy of restoration and was parted out.  The title was still in the name of the previous owner, but had been signed over, so our member who had it crushed was the last listed owner. 

The Warrior Project car and the Fastback Formula were given to the club with the only caveat that they be given a good home.  The title to the Warrior Project remained in that person's name until it was restored and given to Barry.  The Formula is still registered to the person who donated it to us.  No requests for tax credits were made nor wanted.

The value of the tax credit should be that value of the item at the time of donation.  The Warrior Project was worth much less when we received it and it wouldn't be legal for the benefactor to claim a tax credit for all the items donated by other persons. 

Georgia Fieros has never applied for an Employer Identification Number (EID Number)  That number is needed to make any tax credit receipt valid when the value of the donated item is above a certain threshold.  I don't know what that threshold is.  In most cases, an individual's donations don't meet the minimum percentage of their income.  Melanie and I donate a lot to Goodwill, claiming the value of what we could get in a yard sale.  I'm pretty sure that our income is less than anyone else in the club.  Even with having donated several truck loads of clothing and with all our medical and doctors expenses, we still didn't have enough to itemize. 

[f85gtron]

Pgackerman,
Have you been cooking up some scheme with my wife to get rid of my notchie?!  Sounds an awful lot like something she would come up with....
I smell treachery afoot!

[pgackerman]

It's not paranoia when everyone is out to get you.

[pgackerman]

From my limited research it looks like someone can claim up to a $500 value on a donated car w/o IRS questions.  Keep in mind I am not a CPA nor do I play one on TV:

    The IRS Allows The Taxpayer To Claim A Charitable Tax Deduction As Follows:
    We make it easy to get the maximum tax deduction for your vehicle donation! Simply filling out the quick form to the right (or call 1-
    877-431-9474) and we take care of the rest. Your vehicle is picked up, sold, and proceeds benefit your local Make-A-Wish®, but you
    also get a 100% deductible receipt.
    If the donated vehicle is sold for less than $500, you can claim the fair market value of your vehicle up to $500 or the amount it is sold
    for if less than fair market value.
    If the donated vehicle sells for more than $500, you can claim the exact amount for which the vehicle is sold.

If I understand this correctly, someone could donate a Fiero to the club and claim $500 on their taxes towards charity.  This equates to about $500 x 30% = $150 back in their pocket from tax savings.  More than they'd get from a crusher, plus the car would no longer be on their property and they'd be doing a good thing.