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The end of the year is upon us and income taxes are just around the corner. Something that may help you might just be sitting in your driveway your old car. Many charities have programs which allow them to take donations of unwanted vehicles which they then covert into cash through auctions or "parting out". The benefit to you is a possible charitable donation and associated tax deduction on your tax returns.
If this sounds of interest, there are some things to research beforehand. Make sure the organization is recognized by the IRS as a charitable organization. Any reputable organization will be willing and able to provide you with documentation that they are a non-profit 501(c)(3) charitable organization.
Warning companies exist that claim to handle all of the details and paperwork for charitable organizations they may be fraudulent. Always check with the charitable cause directly they will be able to provide you with the appropriate contacts and how their system works.
Most, but not all, organizations will require that the vehicle be in operating condition. Many have nationwide pickup and will send a tow truck to your location to retrieve the vehicle. You must have clear title to the vehicle and the organization will research the Vehicle Identification Number (VIN) to verify that there are no problems with the car. If conditions are right, you may be able to claim up to the fair market value of the car donation as a deduction. Automobile donations claimed at over $5000 require additional appraisal forms to verify the value of the car.
You may refer to IRS publication 526, "Charitable Contributions" and a second reference, IRS Publication 561, "Determining the Value of Donated Property," for additional details on limits and required documentation. In addition, consult with your financial or tax advisor to confirm that this type of donation is appropriate for you.