| When donating your car to your favorite charity, the | | | | Entities Customer Service at 1-877-829-5500. |
| Internal Revenue Service (IRS) wants you to be | | | | You should take into the many factors into |
| aware of certain pitfalls. After December 31, 2004, | | | | consideration to establish the fair market value of the |
| taxpayers planning their charitable giving, donors should | | | | car. Many used car buying guides contain step-by-step |
| understand the way that the American Jobs Creation | | | | instructions so that readers can make adjustments to |
| Act of 2004 will alter the rules for the contribution of | | | | the value of a car for accessories, mileage and other |
| used motor vehicles, boats and planes. | | | | indicators of its general condition. Publications like |
| When the claimed value of the donated motor vehicle | | | | Publication 526, Charitable Deductions, and Publication |
| exceeds $500 and the item is sold by the charitable | | | | 561 provided such details. |
| organization, the taxpayer is limited to the gross | | | | Taxpayers cannot take a deduction for car donations |
| proceeds from the sale. | | | | if they do not itemize deductions on their personal tax |
| Under the rules in effect for 2004, taxpayers will be | | | | return. The decision to itemize is determined by |
| able to deduct the fair market value of the contributed | | | | whether their total itemized deductions are greater |
| property. | | | | than the standard deduction. |
| Here is what IRS officials recommend to people | | | | Taxpayers must document the automobile donation |
| donating their cars: | | | | and its fair market value. IRS Publication 526 details |
| Check the qualification of the Charity. Taxpayers | | | | requirements for the types of receipts taxpayers must |
| should make sure that they contribute their car to an | | | | obtain and the forms they must file. |
| eligible organization, else their donation will not be tax | | | | Some used car donation programs mistaken that |
| deductible. They can use the IRS Website to check | | | | donors can deduct the highest value listed in a |
| that an organization is qualified by searching Publication | | | | used-car buyer's guide regardless of the donated |
| 78. Publication 78 contains a list of most organizations | | | | vehicle condition. The IRS only allows a deduction for |
| that are qualified to receive deductible contributions. | | | | the fair market value of the car. Fair market value |
| Publication 78 is also available in many public libraries. If | | | | takes into account many factors, including the vehicle's |
| in doubt, you can call IRS Tax Exempt/Government | | | | condition. |