Instead of towing your car to the junk yard, consider donating it to a charity for maximum tax write off and good karma. In most cases, even if your car is not running, you can still donate it and get a tax deduction of $500 if you itemize.
Donating a car can be little tricky if you have never done it before and don’t know anyone who can help you out. There are three main things you should know before your donate your car.
1. Choosing a Charity
There are many car donation charities that accept cars and other vehicles as donations but it is a good idea to do some research. Maybe you already have a favorite charity then all you need to do is find out if they take cars as donation. For e.g. if you live in Illinois, go to Google and search for car donation Illinois
2. Use of Car Proceeds
Proceeds from car donation can be used in number of different ways depending on the condition of the car and the purpose of the charity. Most charities will sell the car and use the proceeds.
3. Tax Exempt Status
It is important that you verify the tax exempt status of the organization you are donating your car to. If an organization is 501(c)(3) then you will be able to deduct 100% of maximum $500 without appraisal of the car.
Charities that except cars as donations make it very use for you to donate and they take care of all the paperwork involved. All you need to do is make a phone call.
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