Vehicle Donation Tax Deduction

People who are donating vehicle donation tax deduction must be aware of false and misleading claims, such as: maximum deduction, full fair market value, and fully tax deductible which are made by certain online car donation, radio, TV commercials, or other mass media. You absolutely should know that the value of donation is based upon the actual fair market value of the vehicles. This value is very difficult for common people to figure out and causes various complications and problems. The new rule of regulating vehicle donation tax deduction was published on January 1, 2005. It tells that you may deduct the full price for the sale of your vehicles and it will be in several ways of process.

The new rules of vehicle donation tax deduction are divided into several ways. If your vehicle sells for more than $500, the following applies: 1st is if your vehicle sells for more than $500 you will know exactly the amount you may deduct. It causes you don’t have to take a research about the fair market value of vehicles for estimating yours. The selling price of your vehicle becomes its fair market value and what you can deduct on your tax return in most cases. You can also throw away the risk of you get into trouble by overstating the value of your deduction on your tax return. This will make you save in both time and risk. 2nd is if you car sells for $500 or less at auction, you may deduct what you determine as the fair market value of your vehicle or the amount the vehicle sold for, which is less and as long as that figure is under $500. Other rule that has written to regulate this cases is the IRS Publication 4303, “A Donor’s Guide To Vehicle Donations” states: “…the written acknowledgment must contain…the date of the contribution…”. The date of contribution is the date that the Foundation receives the donation form. For instance; if you give the donation form on the 31st of December, so it will still be for that tax year.

Vehicle donation tax deduction is the only exception about the same year tax for submitting the donation form which is if you cancel the donation and then resubmit it later, it will effect you will not get the tax of that year. In general, if you work with the towing facility and assist in any problems that may arise, so your donation will still be considered effective the date you filled out the donation form

Source: http://www.donatingacar.us/vehicle-donation-tax-deduction-672.html#ixzz1SWqlYa4t