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Avoiding Destination Charges When You Donate a Vehicle to Charity
from:You should never, ever be given a bill with destination charges, whether you donate a vehicle to a charitable, non-profit organization or are the recipient of a charitable gift from such an organization. Donated vehicles that are kept in-state are, no matter how many pieces they're in, should never subject you to any type of charge.
For starters, a charity that runs its own donated vehicle program is not allowed to charge you a fee to make a donation. If they take donated cars, then they can choose which ones to take, but not to charge you a fee. Even if they end up loosing money after the tow fee is taken into account, many non-profit organizations (NPOs) still take such donations, just to “encourage a culture of giving.”
That leaves third-party, usually for profit, companies that manage donated vehicles for the charities that don't have the facilities (tow truck) to pick up and process cars, trucks, boats, RVs and trailers. If they are actually affiliated w/ a genuine IRS-approved and exempted charitable organization, they are not allowed to charge you a towing fee either, since they're acting as an agent of the charity
Only a third-party company that wasn't operating for an actual charity would be likely to charge you for towing (especially without telling you about it first). You should stop your dealings with such a company immediately and check into their charity a little closer, even if that means reporting them to the state Attorney General's office.
Also, there is plenty of a market for the raw materials and components of even cars that aren't running any more. Even if the amount of a refund you get from a donated vehicle that is sold at wholesale auctions is quite small, the value increases greatly as each component is sold and resold again until eventually turning up in an automotive repair on the other side of the country. The appreciation is part profit motive and part transportation fees. It makes your donated vehicle, ultimately valuable, though your charity will see very little of that unless they actually run a surplus auto parts business.
Sometimes for-profit, third-party agents will have a business on the side by where they trade you promotional offers from cruise ships and vouches for hotel stays for the chance to recycle your car. Though the claims of the environmentalism of such a trade as it's hard to know at what point the additional miles of the object in question (and its eventual function of keeping another car on the road) are offset by the inherent energy involved in finding, extracting, heating and purifying the metal, much less the elaborate network that created that part in the first place.
Regardless, if there is very little benefit to your local charity after the third-party agents they employ take their cut, it may be just as good of a choice to choose to “recycle” the vehicle rather than donate the vehicle and then not bother to take the paltry deduction, anyhow.
Destination charges are usually assessed on drivable cars taken in and out of state. For instance, if you were to purchase a new car from the dealership, there's often a line on the bill denoting a destination charge. This is to pay for the caravan of cars that is sometimes seen travelling across interstate highways. In fact, it is because of a network of dealerships that destination charges are even assessed for new cars.
The closest thing to a destination fee that you should find when you donate a vehicle to charity is the tow truck fee. However, that fee should also be paid by the charity or the third-party agent working for the charity as part your donation. It is very rare for any type of towing charge to apply to you when you donate a vehicle.
For starters, when you are considering donating a vehicle, you should ask what charity will be benefiting. If you've never heard of the charity in question, ask if you can have their tax ID number that identifies the charity as an exempt charitable organization. You may look this up online or call the IRS.
When you donate a vehicle to a non-profit, there's something very much wrong if you are then asked to pay for destination charges. Don't accept that, even if they have your car up in the jack.
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