basics

If you want to make a donation to a favorite charity and do not want to give cash, there is an alternative. Donate a motor vehicle. Assuming the charity is one approved by the Internal Revenue Service (IRS), then there are many reasons it makes sense to sign over that title to the charity.

One good reason involves a car that is in good shape. The charity can keep the car and use it for its own purposes. That could involve allowing an employee to drive it while soliciting or picking up donations. There are endless uses for the charity and it will save cash as the charity will not have to purchase another vehicle. They can use its cash for the more pressing problems the charity serves. Keep in mind that “good shape” just means that it works and is drivable and not that you shined it up with car wax and the like before donating it.

A second reason is taking a tax deduction. There are a couple of problems with this reason. The first and foremost is the fact that the donor must itemize deductions. If a person does not itemize, then the deduction cannot be taken. If a person has enough deductions without the automobile deduction, then it is a matter of obtaining a fair market value that can be justified to the IRS. Another possibility is a person with almost enough deductions who needs one more deduction so all their deductions are not lost. Donate a vehicle to get over the top.

Sometimes cars start to break down and the costs of repairs are not justified. In other words, it is smarter to get another vehicle rather than repairing the old one. In that case, donation makes perfect sense. Charities generally have the ways and means to dispose of donated vehicles so the repairs do not matter.

People use their old cars as trade when buying another vehicle. Sometimes though the value of the trade is just not worth much because the car dealer does not want the old car. That is the perfect time and reason to donate the car to charity.

Another reason to donate to charity is the ease of getting rid of the vehicle. No placing ads in the paper or online in an attempt to sell. No worry about buyers complaining about the vehicle after the sale. No arguing with car salesmen about the trade value. Just call the charity and they will handle all the details. Just tell them you want to donate a vehicle and your worries are over. It is just like cleaning out the closet and taking old clothes to a charity.

There is great value in feeling good about an action. When a vehicle is donated to a charity it is just like writing a check. The charity will sell the vehicle and get cash. The donor has helped the cause, no matter what it is. Charities want vehicles and many times run public service announcements asking for cars, especially at the end of the calendar year when donors are looking for tax deductions.

There are certainly more reasons to donate but just remember the best reason is helping the charity.

basics

An easy way to donate to charity is by donating a car. Car donations are also an easy way to get a large tax write-off. When you donate a car to charity, one of two things happens.

One, the charity auctions off the vehicle so they can use the proceeds. Two, the charity keeps the vehicle and uses it. If the first one happens, you can claim on your taxes the final auction amount. If the second happens, you can claim the fair market value of the vehicle.

Here are 5 tips to donating a car to charity:

1. Look for charities that accept car donations directly. There are some intermediaries that accept car donations on behalf of charities, but they keep a chunk of the money. To get the most money to charity, choose a charity that takes its own car donations, like the Salvation Army.

2. Drive the car to the charity instead of letting them tow it in. If they have to tow it, then that is less money that the charity can use on their programs.

3. Only donate to tax-exempt charities with the 501 (c) (3) designation. This is the only way you can claim the donation on your taxes. You can check the charity’s status with the IRS via Publication 78 online.

4. Get your car appraised if it is worth over $5,000 because the IRS will not let you claim the donation amount unless you have an appraisal. If it is worth less than $5,000, you will be find with a Kelley Blue Book value quote.

5. Prepare to sign over the car title to the charity as soon as you make the donation. Steer clear of charities that want to you leave it blank and not sign it over yet. This leaves you liable for the car until they auction it off.

basics

If you have made a charitable donation during the tax year, you want to make sure that you claim it on your taxes. The Internal Revenue Service (IRS) allows taxpayers to claim charitable donations as tax write-offs. This is an excellent, and legal, way to lower your taxes due come tax day.

In order to claim a donation on your taxes, you must have made the donation to an organization that is eligible for tax deductible donations. This is sometimes referred to as the organization having tax exempt status. Typically all non-profit organizations meets this qualification. And usually all national charities, like the Make-A-Wish Foundation, are eligible for tax deductible donations.

If you have made a donation to a local charity though, you may not know their tax exempt status. Luckily, you can check it out on the IRS website.

It is a good idea to check the charity status (link opens in new window) on the IRS website before you make the donation, in the event that you have chosen a place that is not eligible for tax deductible donations.

If you have made your donation to a charity that is eligible for tax deductible donations, you must itemize your deductions. You have to use Form 1040 when you file your taxes. And you must also fill out Schedule A for the deduction.

Determining FMV

Fair market value, or FMV, is commonly used as the value of donated goods and items.

The Internal Revenue Service (IRS) defines fair market value as the price that you would be able to sell an item for in the current market, assuming that the seller is not desperate for the sale and the buyer is not desperate to own the item.

It is safe to say that most of the time the FMV of an item will be considerably lower than the price that was paid for the item. Instances when this may not be true could be with antique cars and real estate.

Determining fair market value of an item depends on what the item is.

There is no set or approved way to determine fair market value. Sometimes you can use a variety of methods and just take the average.

For example, to get the FMV of a car you can check Kelley Blue Book, eBay Motors, Cars.com, local used car lots and your local newspaper classified ads. You can end up with a range of different values from those places. This is when you would just use the average of all of those values as the fair market value of the vehicle.

If you can’t recall how to get the average, just add together all of the value that you have. Then take that number and divide it by the total number of values that you started with. The end result of that calculation is the average.

basics

The City of Alexandria, VA is located within the Commonwealth of Virginia. It is part of a large metropolitan area known as Northern Virginia or NOVA and lies right outside Washington DC. The city lies on the banks of the Potomac River and has some of the most interesting shopping and dining experiences in the D.C. metro area. Alexandria is fairly small, with a population of less than 160,000. The city’s proximity to Washington DC has shaped much of its character and personality.

Most of those who live in Alexandria work at a job that supports the federal government in some way. Many of its residents work in the federal civil service, are in the U.S. military, or are employed by the one of the numerous private companies which contract with the federal government. The U.S. Department of Defense is one of the largest employers in Alexandria, along with the United States Patent And Trademark Office and the Institute for Defense Analyses.

Old Town Alexandria offers a truly unique shopping experience. The area boasts many boutiques, antique shops, restaurants, and theaters and is a major tourist destination. Most neighborhoods are high income, as well as compact and walkable. Alexandria is an independent city with its own government and services and has the highest average income of any independent city within Virginia.

The city is only 15.5 square miles in total area, including .42 square miles that lie within the waters of the Potomac. The city is bordered on the north and northwest by Arlington County and on the east by the Potomac River. It is bordered on the south by Fairfax County, one of the wealthiest counties in the United States. There are several established neighborhoods within Alexandria, including Old Town, Rosemont, Eisenhower Valley, Parker-Gray, The Berg, North Ridge, West End, Alexandria and Del Ray.

The demographics of the city include moe than 68,000 households and 31,000 families. It is a population dense city with 8,500 persons per square mile. According to recent estimates, the median household income was $85,000 and the median income for a family was $105,000. Income for either gender was about equal. About 9 percent of the population lived below the poverty line, including residents age 65 or older. The city is served by Alexandria City Public Schools and is home to some of the finest private schools in Virginia.

The City of Alexandria is a delightful community and a fine place to both visit and live. Great shopping, fine dining, and live performance are also readily available.