Are You Planning To Donate A Car In California
Are You Planning To Donate A Car In California: Are you a resident of California? The largest state of the United States by area while being the most populated state as well, California is a beautiful place. So along with the extra load that you have collected over the years do you also have a car that is sitting idle, collecting dust and rust? Have you ever thought of donating it? Donating your car will benefit the less privileged and will be a source of endless blessings for you. There are more benefits for you as the idle car will not only be removed from your property but will be counted as an act of kindness while the donation will also help you claim a tax deduction. So you see, the car that is wasting away, occupying so much space can become a source of happiness for you and others.
Lets see how you can donate a car in California and which particular things you need to ensure while taking the decision.
- The first step for donating a car in California would be to select the charity you would like to donate your car to. If you are planning to claim tax deduction on your car donation then ensure that the charity that you have selected is a registered IRS non-profit organization. You can then call them for further details or submit their car donation online form.
- Different charities follow different procedures so it would be good to check their procedures by talking to the concerned person so that any confusion of misunderstanding may be avoided. Be sure to confirm how the charity will provide you with the initial receipt for claiming your tax deduction up to $500. Ask them if they will email the receipt or hand it over to you when they visit you for towing your car away.
- Be sure not to remove the license plates of the car you are donating as in the State of California they will require them along with the car.
- Another important issue for you to ensure while donating a car in California is Filing a Release of Liability with the California Department of Motor Vehicles. This will help exempt you from all kinds of liabilities once the car has been donated. You can complete this process in California either by filing an on-line release of liability at http://www.dmv.ca.gov. or simply by submitting the pink part of the title or DMV form REG 138 to Department of Motor Vehicles located near your vicinity.
- Let’s hope that your donated car fetches more than $500 in which case you will qualify for additional tax deduction. The final amount of tax deduction will however be dependent on two things (i) the sale price of the donated the car (ii) fair market value classification of your donated car.
Be sure to donate your car in California a safe time before the deadline of December 2018 so that you are able to claim your car donation tax deduction with in current tax year. Keep margin for delays on part of the charity as they might have procedures to follow that may take some time and make you miss the last date of donating within the year. You car donation should be completed well before the clock strikes 12 on the night of December 31st! So it is advised to make the act of kindness as soon as you have decided so that it benefits you and the others without wasting your precious time.
- If you have queries regarding donating a car you can even visit your local DMV in California in person or visit their website for finding answers to some specific questions. However the charities that accept car donations are quite cognizant of the procedures and the paperwork involved regarding car donation in the state of California and would be able to guide you well however if you any particular questions related to your tax issues you can also seek advice from a CPA or accountant .
7 Other Points You Must Know Before You Donate Your Car in California
- Ensure selecting a charity to an IRS registered nonprofit organization so that it will benefit you in your tax deduction:
- The charity must be a qualified, eligible, 501(c)3 IRS registered charity.
- You can yourself verify if the charity is registered by searching Publication 78 which should be available in your public library. This publication provides an annually updated list of charities that qualify for benefiting their donors in deductible contributions. If visiting a library is not convenient you, you may call 1-877-829-5500 and inquire if the charity is registered at IRS Tax Exempt/Government Entities Customer Service. They will require the complete name and office address of the charity before they can provide you with the correct required information
- Find out the receivable tax deduction of your donated car:
As a donor and a tax payer who is interested in benefiting from a car donation you must ensure that your tax return shows itemized deduction and not simply a standard deduction. You can itemize your deductions on Schedule A of Form 1040 to establish whether your itemized deductions are greater than the standard deduction.
- You should know the fair market value of the car you are donating
Be realistic about the condition of the car you wish to donate before assessing what the estimated price it would sell at. You can consult the “blue book value” for an approximate price it will fetch. The car you are willing to donate is definitely tax deductible:
- If the car you are donating is now estimated at a lower side you may easily claim the fair market value up to $500. There will be long paperwork process involved and the receipt provided by the charity at the time the car was officially donated will suffice for the tax deduction claim.
- The charity is liable to provide you with the gross sale value receipt if your car is sold for more than $500.
- Most charities sell donated cars in auctions which results in getting lower rates than what “blue book value” estimated the actual worth of the car.
- If your donated car is in a good condition then the charity might retain it for its charitable projects.
- Select a car donation charity which offers free services nationwide:
It is important to verify that the charity you are donating your car to will provide a free pick-up of your donated car from your door step or wherever it is parked. Ensure that there are no charges at any stage that were kept hidden from you.
- Ensure that you have complete documents of your car with you:
When donating your car to charity in California, you will require handing over the complete documents as well. Hence in-case you cannot locate the title make sure to contact the Motor Vehicle Department, well before time for getting a duplicate title.
If your donated car is not in a good condition then it might be sold for its parts. In that case the title will not be required.
- Find out what kinds of vehicles or transport the charity accepts:
There are charities that accept all kinds of vehicles including cars, vans, trucks, motorcycles, boats, RVs, motor-homes, campers and personal watercraft however you should ensure that the kind of vehicle you wish to donate is acceptable.
You will also need to check their acceptability in-case the vehicle you wish to donate to a charity in California is in non-running condition, wrecked in an accident or otherwise damaged.
- The necessary IRS form:
If you have donated non-cash items in the current tax year that exceed the worth of $500 then you would be required to submit an IRS form 8283 for tax deduction which is easily accessible on the IRS website.