Should You Donate Your Car to Charity?

Why would you donate a car to charity? Besides the obvious answer that you are helping those in need, you also get a tax break. Often a very generous tax break worth more than the real value of the car. It used to be that charities would give you the highest possible total value on your car. Years ago I donated an old Ford I had that had not run in years. In fact the tires had become melted to my asphalt driveway and when the guy came to pick up the car he had to whack all the tires with a sledgehammer to free them up before loading the car onto the back of his tow truck.

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He told me he had to do that to many cars he picked up. When he had loaded the car he gave me a slip of paper saying the car was worth $4400 and it did not even run. Today the IRS has cracked down on this somewhat but donating your old car to charity can still be beneficial for you and also a very good deed.

Why do charities want your old useless cars? They have value!

Many years ago I let a friend of mine drive around an old truck of mine which had almost 150,000 miles on it and had taken me through 38 states including Alaska. It was my third vehicle at the time and I only needed it when something big had to get hauled around so I just let my friend keep the truck and drive it around and he reimbursed me on the insurance. One day I got a call from my friend telling me he had an accident with the truck late the night before.

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He was working two jobs and fell asleep at the wheel on the way home from the second job and hit the highway median and totaled my truck. I had to drive down to the public lot where what was left of my truck had been towed to after the accident. 

The truck was in bad shape. The whole front end and one side was pushed in and it was clear my truck was never going to run again. The manager of the lot told me I owed $49.00 for the tow and one day storage. With a glint in his eye he told me if I signed the car over to him he would waive all the fees. I laughed and went to call a bunch of junk car dealers. You see even cars that can no longer be driven have scrap value. People will give you money for them but the question is how much? The first guy I called offered me $250. The second one offered me $400 and the third one offered me $550. Naturally I took the $550 and the guy handed me 5 one hundred dollar bills and a $50, which I promptly gave to the lot manager to cover the fees I owed and walked out of there with $500 in my pocket.

That is why charities want your old cars even if they do not run. They can then turn around and sell them to junk dealers for the scrap value of the cars. Of course if the car runs they can take them to used car dealers or used car auctions and get what money they can for them. Essentially the charities, really the people the charities hire to do this for them, are acting as middle men between you and used car or scrap dealers. In exchange you get a tax break and help out those in need. When I donated my old car I was given a list of 10 charities to pick from where the proceeds of my old car would go. On the list was a homeless shelter, construction of a public park project, an animal shelter, a youth center and more. I chose to donate to a local food pantry that helped feed the homeless and needy families.

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So should you donate your old car to a charity? The answer is yes if you want a generous tax break and to help out those in need.

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