Do you have an old car that you would rather donate than sell? The IRS allows you to claim a vehicle donation to an eligible charity as a tax deduction. How much you can deduct, however, depends on a variety of considerations. You’ll need to determine your vehicle’s fair market value (FMV), which is how much it’s worth based on year, make, model, mileage, condition, and other factors. You’ll also need to ascertain that the vehicle will be used in a capacity such as:
- Sold at a below-market price
- Given outright by the charity to a needy individual who requires a means of transportation
- Used by the organization to carry out charitable operations, such as delivering meals
Taxation Solutions, Inc. can give you more information about vehicle donations, including advising you on making the most of that donation on your tax return. For instance, we’ll know when you are and are not allowed to claim the full FMV. Our job is to help you send accurate information to the IRS, avoiding tax problems down the line.
Ready to learn more? If you’re based in the greater Cincinnati area, we’re standing by to take your call.