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How to Donate Cars for a Charitable Tax Deduction

Updated on January 28, 2018
Pay less tax by donating your old car to charity.
Pay less tax by donating your old car to charity. | Source

Why would anyone want to donate their old used car to a charity when they could just sell it to someone else for a profit? Well, this article is for those who have an old beater that would be better off removed from the streets for safety reasons.

Donating your car for a charitable tax deduction can be beneficial to yourself – including others. Lots of people don’t want to sell their cars because they want to avoid giving their “lemon” to someone only to have it fall apart or have transmission problems soon after the sale. Nobody wants an angry customer to come knocking on your door demanding their money back!

In these types of situations, one of the best options is to donate cars to a charity – or more specifically – donate cars to a car disposal company that will put the proceeds to a charity of your choice.

Vehicle Disposal Companies

So what really happens after donating your car to one of these companies? When a car becomes useless and can no longer be sold to another person to drive, the best alternative is to sell the car to a vehicle disposal company that will make use of the car’s parts. After the sale, you can fill out the appropriate paperwork for the charitable tax deduction.

Did you know that over 95% of a vehicle can be recycled? After a car is sent to be compacted and recycled, the majority of the steel can be used to produce new cars.

In fact, many of the new cars that we see on the street today are made of recycled parts. Materials that previously belonged to older cars are crushed, ripped apart and sold by disposal companies to car manufacturers who use those materials for new automobiles.

If you request, many of these disposal companies will forward the profits they receive from your compacted car to the charity of your choice. It’s important to select the proper “green” disposal company to donate cars to so that you know where the money is going.

Vehicle disposal companies can make the process easier.
Vehicle disposal companies can make the process easier. | Source

Environmental Benefits of Donating Your Car

Not only can you generate cash for charity when you donate cars, but you are also doing a good deed for the environment. Older cars have terrible fuel economy and burn gasoline faster than the newer more efficient cars on the market today.

Therefore, just by taking your car off the road, you’re doing the planet a world of good. You will certainly spend less on gas in the long run if you get a vehicle that has better fuel economy. It is a worthwhile investment for your wallet and the environment.

Furthermore, these companies dispose of your old car in an environmentally safe way that does not wreck havoc. When cars are disposed of in a proper manner, mercury and other dangerous materials are removed so they are not harmful in any way. Remember that if you donate cars in this manner, you’re completing a big step in the recycling process.

Recycle car parts
Recycle car parts | Source

Get a Charitable Tax Deduction for Your Car

Donating your car to a green disposal company can also help you save money when you file your next tax return. When you say goodbye your old beater as a donation, you can use the profits generated as a write off for when you do your taxes. Plus, since the proceeds from the vehicle go to a charity of your choice, other people in need can benefit from your decision as well. It is really a “win win” for everybody involved.

So once the time comes to take your old beat-up Chevy off the road, remember to consider donating your car to a charitable waste disposal company to recycle. More often than not, it is better to donate cars for recycling and charitable purposes once they become too unsafe to drive.

The benefit of a charitable tax deduction and rewards to everyone else involved far outweigh the costs of leaving the lemon in the garage to rust.

Video: How to Donate a Car to Charity

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    • profile image

      Jennifer 

      5 years ago

      Car donation for charities has become very common these days. Most people prefer to donate their old, used, car for charity instead of going through the hassles of selling it. Since the proceeds of the donation would be used for a worthy cause, this is generally a noble way of getting rid of an old car. For more information just visit: www.caringcars.org

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