When you have an older car, it sometimes makes sense to trade it to the dealership to shave off some of the cost of your new vehicle. But there are some cars that are so old that it doesn’t make sense for the dealership to take them, or you might just decide that there’s something better to do with your vehicle. One option is to give your old car to a charity. There are a lot of benefits to donating your old car, and here are three of the most relevant ones.
1. You Get a Tax Deduction
You know that you can get a tax deduction when you donate things to thrifts shops, such as Goodwill and the Salvation Army, but did you know that there are plenty of organizations that take old cars? Many of these places are nonprofit, too, so you can take a tax deduction if you choose an organization that falls under section 501(c)(3). If you want to count your donation as a deduction, there are a few things that you should know. Besides ensuring that you’re donating to the right place, you also need to determine the fair market value, which is how much you would be able to sell the car for, which might be different than the blue book value. If the amount that you’re claiming is greater than $250, you need to get a written acknowledgment from the charity. You also need to get a written appraisal if you will be claiming a deduction of $5,000 or more. For more information on how to claim a deduction for a car donation, visit the IRS’s Donor’s Guide to Car Donations.
2. It’s an Easy Way to Get Rid of a Clunker
If you have a vehicle that’s been sitting in your driveway or yard for months or just a week, having someone else pick it up for you can get rid of a big eyesore. If you have an older vehicle that won’t move, there are some charities that will even pick up your old junk car. They want the parts on the vehicle, and they have the tow truck to pick it up for you. This can save you from the towing costs, and it will save you from needing to pay for the disposal, too. The charities around you will vary by your location, but you can use the IRS’s Tax Exempt Organization Search to find organizations near you that qualify as charities.
3. You’re Helping the Environment
When you donate an old car to a charity, the materials might also simply be recycled, which keeps thousands of pounds of metal out of landfills with every vehicle. When a car or truck is recycled, it’s brought to the junkyard where the usable parts are harvested. This might include big-ticket items, like a working engine, but it also includes items that you might not guess, such as many of the fluids. The car is also stripped of the windows, mirrors, rubber interior mats, and many other smaller pieces. Finally, when the vehicle has been stripped down, the body is crushed and sent to a plant where it is melted down to make other things. Reusing metal is less expensive than mining new metal, so you’re not only reducing the amount of material that goes into landfills, but you’re also cutting the amount of iron ore and other metals that need to be mined.
If you’ve been unsure about what to do with a vehicle that no longer has much value or can’t be sold at auction, you should take a look into donating your old car. When you do this small service, you’re doing a lot for your community, and you can save yourself some money in the process if you do some research.