How to Donate a Car to Charity

Selling a car on your own can be more trouble than it’s worth—especially if the car you’re trying to sell has little value. It can also take time to find a buyer, which means the car may be taking up valuable space in your driveway or garage for far too long. Thankfully, there’s an easier option: donating your car to charity.

In this post, we’ll explain the benefits of donating a car, how to donate a car to charity, and when to do it.

Reasons to Donate a Car

Donating a vehicle to charity is easy, and that’s one of the reasons it’s a popular option for unloading a “beater car.” Here are three other reasons to donate a car:

Convenience

If your car doesn’t run or has major mechanical problems, selling it will be difficult. Many charities will gladly accept a non-working vehicle, and they may even tow it away for you, making the entire donation process fast and hassle-free. Where tow-away services are not available, Rawhide Youth Services provides car donors with more than 200 convenient drop-off locations across the state of Wisconsin

Positive impact

An old car that might be a burden for you could be a valuable gift for charity. For example, Rawhide Youth Services benefits from car donations in two ways: our teens learn important skills when they help refurbish vehicles, and the money we make selling cars at auctions supports our residential and youth counseling programming for at-risk youth.

Tax advantages

Donors whose cars sell for more than $500 can claim the full selling price as a tax deduction. If your car sells for less than $500, you can claim either the fair market value or $500 (whichever is less). So, if your car sells for $250, but the fair market value is $700, you could claim a $500 deduction.

Many charities that accept car donations generally do not restore them for sale at auction. Rawhide Youth Services, however, inspects and often mechanically improves many of the vehicles before auction, which improves the resale value and can give donors a potentially higher tax deduction.

How to Donate a Car to Charity

Wondering how to donate a car that doesn’t run? It’s simple—here’s what you need to do:

Search for an appropriate charity

Make sure you choose a charity with a 501(c)(3) status—not a 501(c)(4) organization. Donations to 501(c)(4) organizations are not tax-deductible. To check on the status of a charity, you can search for the charity name on GuideStar.

Prepare your vehicle

Before donating your car, remove all personal items (don’t forget to check under the seats), and remove the license plate. Ensure that the tires are operational — for example, add air to deflated tires, or replace any that are missing.

Make arrangements for FREE pickup or drop-off

Rawhide Youth Services makes it easy to make donation arrangements. Just fill out the online donation form or call us.

When Should You Donate a Car to Charity?

So how do you know when to donate your vehicle to charity? If your answer to any of the following questions is, “Yes,” it might be time to donate.

Does your car need repairs that exceed its value?

If your car has extensive body damage, rust, or mechanical problems that would be expensive to repair, you may be better off donating your car and getting a tax break.

Do you need to free up space?

An old, non-working vehicle sitting in a driveway can be an eyesore, and if it’s in your garage, it may be taking up valuable storage space. Donating your car is an easy way to create more space at home.

Did you inherit a car with little value?

Occasionally, people inherit old cars from their relatives and simply don’t have the time or resources to restore them. Charities will accept old cars, even discontinued models.

Is the end of the year approaching?

If the idea of a tax break appeals to you, you’ll need to donate your car in the current calendar year in order to claim it on your taxes by the spring filing deadline.

Do you want to set a good example?

Parents may see car donation as a good way to teach their children about charitable giving. You can donate your car and explain how your donation fulfills an important need.

FAQ

Following are some of the questions we hear most often from people who want to donate their cars.

Can I donate a car that has a lien?

No—you must have a clear title to your car to donate it to Rawhide Youth Services.

Can I donate a car that doesn’t run?

Yes! You can donate your car, as long as it has four tires that roll. Even if your car is badly damaged or missing key components, you can still donate it.

What paperwork will I need to document my donation?

Once your car sells, Rawhide Youth Services will provide you with a tax receipt or a written acknowledgment of the car’s sale price. You don’t need to include this paperwork with your taxes unless your car sells for $500 or more.

If the selling price exceeds $500, you’ll need to include with your taxes either the written acknowledgement or IRS Form 1098-C, along with Form 8283 Section A. You will also need to itemize your taxes in order to claim your deduction.

Can I donate other types of vehicles? 

Rawhide Youth Services does accept other types of vehicles from donors located within Wisconsin. If you have questions about donating a boat, RV, or other vehicle, please contact our donation specialists at 1-800-RAWHIDE.
 

 

Consider Donating Your Car to Rawhide

Rawhide Youth Services relies on the generosity of others to fund our programming for struggling youth. Your donations truly make a difference and help young people learn new skills, find their purpose, and prepare for a brighter future.

Interested in learning more? See our blog posts about some of the young people who’ve participated in our programs and how Rawhide Youth Services changed their lives.