The IRS has set rules for the taxable deduction of your vehicle donation, and they made it easy!
- If the donated vehicle is sold for less than $500, you can claim the fair market value of your vehicle up to $500 or the amount it is sold for if less than fair market value.
- If the donated vehicle sells for more than $500, you can claim the exact amount for which the vehicle is sold.
Based on the sale amount of your vehicle you will receive a 100% tax deductible receipt or 1098-C for within 30 days from the sale of your vehicle. These documents will state the maximum amount you may deduct for your vehicle and the vehicle’s sale amount.
For any vehicle sold for more than $500, the exact amount it is sold for will be stated on form 1098-C provided to you by Charity Auto Donation, which in turn will be your charitable tax deduction.
Frequently Asked Car Donation Tax Questions
Q: In What Tax Year Is My Donation Valid For?
A: The date you fill out our donation form or call in and make your donation over the phone, is the year that your contribution is applicable.
Q:What If The Vehicle isn’t Sold Until The Next Year?
A: Your taxable deduction still applies to the year in which you agreed to donate the vehicle with us.
How to File your Taxes
To receive a tax deduction for a donated vehicle, you must include any charitable contributions itemized on Schedule A of Form 1040 from the IRS. Include your Charity Auto Donation tax-deductible receipt with your tax return. You do not need to submit Form 1098-C if your vehicle sells for less than $500 as your official Charity Auto Donation receipt is considered sufficient documentation by the IRS. If your vehicle sells for more than $500 but less than $5,000 you will need to submit the provided 1098-C form along with form 8283.
For vehicles that sell for more than $5,000, your form 8283 will need to include signature from a qualified appraiser on IRS Form 8283, section B. You can access form 8283 here: IRS Form 8283
For additional information, the IRS provides A Donor’s Guide to Car Donations (IRS Donation Guide 4303), which details the determination of the value of your donated vehicle.
Have additional questions? Give us a call at 855-451-1930
We will do our best to help you with your questions, however American Auto Donation does not provide tax or legal advice. We strongly recommend checking with the IRS or your tax professional before claiming any deductions to be sure they obtain the maximum legal tax deduction. www.irs.gov