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Is an Online Vehicle Donation Service Right for You?
from:There are quite a few reasons that people choose to use an online vehicle donation service. For starters, there's very little that's as easy as filling out a form online and having your vehicle picked up the very next day without any intervening guff. On the other hand, if you're looking to maximize your allowable deduction, you'll have to look further than online. Vehicle donation is always a welcome charitable gift, but gift giving that people can really use takes a bit more effort sometimes.
Of course, the path you choose will have a great deal to do with the value of your car. And, by value, the “fair market value” as recently clarified by the IRS, is the standard. This means, not how much you can expect to get if your car is listed in the Kelley Blue Book as “fair” but instead, how much you could fairly get if you tried to sell the car yourself. So, if you'd be wasting your money to ask for more than $300 for your car with the blown-up transmission and 200,000 miles then you shouldn't claim more than that as a deductible when donating the car.
Online vehicle donation is far more prevalent (and sensible for everyone involved) when the car is already known to be of low value. This way, when it's sold for $50 at wholesale auction, you won't be nearly as surprised as someone who brought in a running car with low miles.
Third-party donation agents, who are almost always for-profit companies, work for charities in most online vehicle donation operations. This means that the amount the charity receives from the sale of your vehicle is dependent upon not only the amount received from its quick sale, but also the agreement between the agent and the charity regarding the amount of a given sale the charity must pay for services.
In fact, in some cases, the deal is such that the charity can actually end up owing these private companies money after your online vehicle donation. If you'd like to know more about any aspect of the company that's is facilitating online vehicle donation for the charity of your choice, it's your right to ask, though most don't bother.
Of course, it depends upon your motivation to contact an online vehicle donation service in the first place. If you don't care about a tax deduction (since it does require you to to to the extra bother of filing your return with itemized deductions) and are somewhat indifferent about supporting a charitable mission, then online vehicle donation is a good outlet for getting rid of a car, truck, RV or boat that's become an attractive nuisance in its disuse.
There are ways to check and see if the online vehicle donation service you've chosen is up to snuff. For instance, you can double check on the charities in question. If at any time someone is reluctant to give you the exempt tax ID number of the charity they claim to serve, then move on. Whether done locally or online, vehicle donation (or any kind, really) requires the charity to be up-front with their non-profit status.
There are, however, plenty of online vehicle donation sites that are perfectly legitimate. Often people choose to go with a company that gives a choice of charitable organizations. They should freely come to pick up your vehicle within days of your contacting them. Don't be afraid to ask about the possibility of any fees up front. If there are any, keep looking, as there shouldn't be a disposal fee unless your car is radioactive.
Generally, online vehicle donation is an above-the-board, legitimate practice, since many of those operating without real charitable sponsorship were weeded out after the 2005 IRS rule changes. These adjustments not only made it harder for companies to continue operating as they liked, without any oversight. The rule changes have also had the effect of increasing public confidence in online vehicle donation sites.
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