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Donating a car to charity was never hassle free. Now it's even more painful.Feb 28 '01 Write an essay on this topic.The Bottom Line Donating your car to charity was never really hassle free, as stated in the ubiquitous commercials. Now, the IRS is cracking down. If you've read my epinion Don't Fall for the "Donate Your Car to Charity" Hype, (http://www.epinions.com/finc-review-3D9-4F44B75-38DBB128-prod6) you already know you can give more money to your favorite charity and keep more for yourself by selling your car yourself rather than of donating it. The only real selling point for automobile donations seemed to be the ability of unload a car "hassle free." Well the process was never truly hassle free, as many taxpayers can attest, because you had to do the legwork to carefully support the valuation of your donation. Looking it up in the Blue Book was never enough, although many people have gotten away with this practice because of lax IRS enforcement. According to my tax preparer, a CPA, the IRS has begun to scrupulously enforce "the $5,000 rule." If you donate an automobile valued at more than $5,000, you must get the automobile appraised and you must file a statement with your tax return that is signed by both the appraiser and a representative of the charity. The IRS will now disallow the deduction on audit if you do not provide the documentation. It's getting to be less of a hassle to just list your car for sale on the web!  |
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