October 23, 2009, Newsletter Issue #172: How to Calculate the Car Donation Tax Deduction

Tip of the Week

The IRS only allows taxpayers to use the fair market value for a car donation tax deduction, when certain conditions are met.
The car donation cannot be worth more than $500 to receive a car donation tax deduction. Or, the car donation has to be used directly by the charity in its programs or services.
For example, if a charity uses a car donation for its meals-on-wheels program, the donor may be entitled to claim the car's fair market value as a tax deduction.
But the vehicle needs to be in proper condition for the donor to assign fair market value.
Be careful. Your used car's value may not be as high as the listing in area pricing guides. High mileage and the vehicle's condition may lower the value.
Check with the IRS to learn more on figuring your car donation's value at tax time.
Two publications may help: IRS Publication 526, "Charitable Deductions," and IRS Publication 561, "Determining the Value of Donated Property."
The guidelines make it easier for taxpayers to follow car donation tax law when giving to charities.

About LifeTips

Now one of the top on-line publishers in the world, LifeTips offers tips to millions of monthly visitors. Our mission mission is to make your life smarter, better, faster and wiser. Expert writers earn dough for what they know. And exclusive sponsors in each niche topic help us make-it-all happen.

Not finding the advice and tips you need on this Car Donation Tip Site? Request a Tip Now!


Guru Spotlight
Susan Sayour