At California, we are quite a petrol-head, and we love our fancy cars, and we also love to give back to the community. Do you want to know how to donate a car in California? So when you are thinking of buying the latest new swanky model in the market and upgrade your ride, what do you plan to do with your old one? Do you want to have that sweet feeling of doing something for the underprivileged while you splash money on yourself? Why not donate the car that you are replacing with the new model in the market.
Why Californian’s Keep Changing Cars?
In California, one of the easiest and swift ways to get rid of the four wheels that you are not using anymore is by donating it. While you can take time to decide whether you should invest in the new car or repair the old one and keep spending money on it, there are lots of other reasons that people want to buy a new car and replace their old vehicle. Some of them are:
- Too many miles covered on the odometer
- Spending too much time and money at the auto-shop
- Failing to impress the clients
- Want the latest features
- Growing family
- Shrinking family
- Birthday or anniversary gift
- Paint and other cosmetic deterioration
- A car that is plug-in hybrid or electric, eco-friendly
Forbes Magazine reported a decade back that 15.9% of the luxury brand car sales happen in California among the 50 states and the District of Columbia. The percentage made California top the list.
Californians often state that they love their cars and spend a lot of time because of the weather and the tax receipt they get from their car purchases. There is sweet news for car owners, with a car donation, you can enjoy tax credit.
Why Donate A Car In California?
With the car donation in California, you will not only enjoy a tax write-off but also help a charity that is close to your heart, and you do not have the time to help them out physically. When you decide to donate a car in California, you can choose a charitable organization that helps with children’s education to terminally ill patients, an animal rescue center, veterans or a center that helps homeless people.
By donating a car, you can give back to society and be part of offering some comfort to those who are in need and less fortunate than you.
Here are some of the Charities that you can consider donating your car if you are unsure where you want to give it.
- California Automobile Donation Program
- California Car Donation
- Cars for U.S. Troops
- Breast Cancer Car Donation
- Habitat for Humanity
- Sacramento Goodwill
- San Francisco Goodwill
- Wheels For Wishes
- Vetmade-Vehicle Donation Program
How To Donate A Car In California?
Now that you know that by donating a car you can give back to society while enjoying a tax benefit, here are some guidelines that you can follow on how to donate a car in California.
- Submit Car Donation Form: Most of the organizations mentioned above have online car donation forms. If you want to donate somewhere else and enjoy the tax credit, you have to ensure that the IRS recognizes the charity as a non-profit organization. So check that the organization has 501(c)(3) registration.
- Get The Receipt: Depending on the charity your tax receipt will either be emailed to you, or it can be given to you when the tow comes to pick up the vehicle from your place. However, this is just an initial receipt with which you can claim up to $500. You need to check with the charity and the IRS guidelines to know the procedure and the receipts you need to claim a tax write-off above $500.
- Keep The License Plate: In the state of California, the license plate of the vehicle stays on it until it is picked up. You cannot remove it before it is being donated or towed.
- Release of Liability Form: You have to fill the form of Release of Liability with the Department Motor of Vehicles, California. This is a vital step that you should not miss when you are donating the car. The document releases you from any liability of the vehicle after you donate it. The process of Release of Liability is simple, where you have to return the pink section of the DMV form REG 138 or the title form to the local DMV. You can also file it online at https://www.dmv.ca.gov/portal/
- Additional Paperwork: If your car’s market value is over $500, you have to fill the 8283 Form of IRS. If the car’s market value is between $501 and $5,000, you must complete the IRS form 8283’section A. When the car’s market value is more than $5,000, you have to get it appraised officially and complete Form 8283’s section B.
- Understand Tax Deduction: if you want to get the tax write-off for the year e.g.2021, then you have to donate the car before December 31, 2021. The pickup must be done before December 31 so that the charity has it before midnight so you can claim the deduction
- Itemize: To enjoy the tax write-off for the car donation you did, you have to itemize the deduction when you submit the tax return. You can enjoy the full market value tax deduction on the vehicle, if:
- The car is used by the charity for its operation
- The car is auctioned or sold after improving it materially
- The car is donated or sold below the market price to who needs it
- Ask questions: Last but not least, as the charity as many questions you want to before donating.
If you have any further questions about how to donate and where to donate your car in California, you can always contact the IRS hotline for the vehicle donation. You can also contact your local DMV or a reliable charity who will guide you through the entire process.