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April 24, 2009, Newsletter Issue #146: Fair market value of a car donation is not always the "blue book" value.
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Tip of the Week
Some fundraisers have mistakenly claimed that donors can, in all cases, deduct the full value of their cars as found in a used car guide (such as “blue book” value). A used car guide may be a good starting point from which to determine your car's value, but you should exercise caution. The IRS will only allow a deduction for the fair market value of the car, which may be substantially less than the “blue book” value. If you are planning to claim tax deductions on car donations, you need to be accurate in making car donation valuations.
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