If you are interested in doing a car donation, here are some ten tips that you may consider.
1) Give the car to a charity that will use the vehicle in its operations. This will enable you receive a maximum tax deduction. You will also avoid your tax being based on the fair market value.
2) Before doing a car donation, ensure that you inquire if the charity will issue you with sac ahs receipt. The receipt is important in ensuring that you have records in case of an audit.
3) Ensure that the charity organization is entitled to receive tax-deductible contributions.
4) Before opting for car donation, inquire if the charity accepts cars directly without involving a third party. This will allow the charity to keep amounts of any proceeds from selling the car.
5) Take pictures of the car and keep receipts of any upgrades done to it to verify its value before taking part in the car donation.
6) Take key of how much the car is worth before doing the car donation. You want to avoid scandals in case the IRS takes an audit.
7) If the car values more than $500, you must fill an IRS form from section A and attach to their tax return so as to complete the car donation process.
8) For cars that value more than $5000, you must fill a form from section B of the IRS8283.
9) When filling the IRS form, give accurate details of your car. Failure to provide the correct information will result in breaking IRS terms.
10) Ensure you have the state title of the car and give it to the charity taking the car donation.
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