Let’s throw out a quick imaginary scenario here.
Say you had an old car that you were looking to get rid of, a friend mentioned something about donating it, and somehow, you landed upon the Kars4Kids website.
(We’re glad you’re here. A pleasure to make your acquaintance.)
You’re reading through the site, nodding happily at all the benefits you’ll receive for donating your car, and then, you pause.
Your eyes have alighted on a cute lil paragraph promising you a tax deduction when you donate your vehicle to Kars4Kids.
Nice, you think. But really, how much of a tax deduction can I actually get for donating a car?
Well, we’re glad you asked.
The amount you can claim from the IRS as a tax deduction in Florida actually depends on several factors, which we’ll explore below, and the value of the donated car for tax purposes can vary.
Here’s How It Works
If the charity sells your car for more than $500, you can claim the full sale price for your tax deduction.
If the charity sells your car for less than $500, you can claim the fair market value up to a maximum of $500.
Fair Market Value
Fair market value is, essentially, the price one could reasonably expect to receive for their vehicle.
That’s based on things such as the car’s year, make, model, condition, and mileage.
You can check out the IRS’s A Donor’s Guide to Vehicle Donation as a resource to learn more about car donation and tax deductions in Florida.
When it comes time to file your taxes and claim your deductions, then there won’t be much work left for you.
If your vehicle sold for less than $500, then you’ll just write the deduction amount on your IRS 1040 Form. If it sold for more than $500, then you’ll need a few other forms, detailed in Tax Deduction at a Glance.
Sometimes a charity may use the vehicle for its own use.
In such a case, a Florida resident could claim the fair market value for the car.
Kars4Kids, however, does not retain possession of its vehicles.
Instead, they work to receive the highest possible sale price, resulting in the maximum tax write-off for your car donation and more funds for the kids.
The IRS requires you to retain the following information for your records if you plan to claim a tax deduction:
- Name and address of charity
- Date of donation
- Place where you donated your vehicle
- Description of vehicle (year, make, and model)
- Written acknowledgment or legal receipt from charity (when sold for more than $500)
The receipt you’ll receive from Kars4Kids contains all the above information and is all the documentation you’ll need. Happy donating!
