How to Donate a Car in California
People donate cars to charities in the U.S. because the IRS (Internal Revenue Service) gives tax benefits for charity donations, because it makes them feel good about themselves, and because it is greatly convenient. It is important that you know the steps of how to donate a car in California since failure to take some steps could lead to donating a car to a charity that does not deserve one or failure to get tax deductions.
The first step of how to donate a car is researching the charity to donate the car to. There are thousands of charities in the U.S., but some do not qualify you for tax deductions by the IRS. You could go to the IRS website for its annual Publication 78 where you will find a list of charities that qualify; you could get a list from Better Business Bureau or BBB’s Wise Giving Alliance, and from America's 200 Largest Charities by Forbes Magazine. You could also give to charities that are run by the U.S. government or other governments and by faith-based organizations. You could read independent reviews for tips on good charities when determining how to donate a car in California.
The next step of how to donate a car in California is looking up the value of your car. You could do this by going to the IRS website and reading under Publication 561, which is titled ‘Determining the Value of Donated Property’, under Publication 526, and under Charitable Deductions for instructions on how to do this. Note that you will only get the full value of the car, only the amount for which the car is sold for once it is in the hands of the charity. This means a car with a $1,500 book value, but which is sold for $750, only gets a tax deduction of the lower value. The next step of how to donate a car is asking the charity if you have other responsibilities.
The next step of how to donate a car in California is giving a notice of transfer to the State of California. The next step of how to donate a car is delivering the car to the collection center. The next step is canceling plates and tags under California law.
The next step of how to donate a car in California is waiting for the charity to acknowledge the reception of the car. This must be done within 30 days. Call the charity if you do not receive this acknowledgement. The amount of the tax deduction will come through the mail. You should use this with the receipt you send to the IRS.
The next step of how to donate a car in California is giving the vehicle ID number, your name and taxpayer ID number, and the date of the contribution if the deduction exceeds the $500 limit, which is the normal IRS limit. You also need to give one of the following: A charity statement that verifies that you did not receive any good or service in return for the car donation, an estimate and description of the value of good or service, if any, exchanged for the car donation or a statement that the goods/services by the charity you contribute to consisted of intangible religious benefits entirely (where applicable).