How is the tax deduction amount on a car donation determined?

family-car-decalThe amount of the tax deduction is based on the sale price of your vehicle. Vehicles that sell for over $500 entitle you to a deduction equal to the sale price. If your vehicle sells below $500 you may take the greater amount of either the sale price, or the fair market value of the vehicle (up to a maximum of $500). This means that in most cases, your minimum tax deduction amount will be $500.

To assist you in determining the value of your vehicle deduction, we can review current selling prices of late model vehicles at our yards nationwide. Older vehicles are sold for a flat rate to our salvage companies and in most cases you will be able to claim the IRS minimum $500 tax deduction for your vehicle donation. After we sell your vehicle, you will receive a charitable donation receipt from your favorite nonprofit, satisfying the requirement of the IRS.

You should consult your tax professional if you have further questions. (Please be aware that to qualify for a tax deduction, you must not receive, in exchange, any goods and / or services from the 501(C)(3) nonprofit organization receiving your donation.)

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