Donating a vehicle can be a great way to give to your favorite charity. The government will recognize your generosity with a special tax deduction, but certain requirements apply in realizing these tax breaks.
Policies regarding vehicle donations are not as straightforward as with other types of charitable contributions. The tax relief you can receive depends not only on the claimed value of your donation, but also on the way the charity uses the vehicle. For this reason, you may not know what your full tax deduction will be at the time that you make your donation. As of 2005, there have been changes to the statutes for tax deduction for vehicles donated to charitable trusts. If the stated value of the donated vehicle is more than $500, and if such vehicle is put up for sale by the charitable trust, then the taxpayer is limited to the gross profits from the transaction.
Taxpayers wishing to benefit from such a charitable donation need to keep the following points in mind:
Itemize Your Deductions
To take full advantage of the deductions available for your car donation, you need to itemize your deductions. Those who claim standard education are...
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