How to Donate an Old Car That Needs Transmission

Many charities advertise that they accept donations of old cars to help the charity raise funds. When you choose to donate an old car to a charity, the charity typically sells the car at an auction, and receives that money to help fund projects. Car owners with non-running cars may wonder if they can donate an old car that needs work. Learn how to donate an old car that needs transmission work, for instance, and receive a tax deduction.

Difficulty: Easy

Instructions

Things You'll Need:

• Car title
• Vehicle Identification Number (VIN)

1. Find the title to your car. You cannot donate a car to any charity unless you have a clear title.

2. 

   Call a charity that accepts car donations. An example is the Family Care Foundation, which has an 800 number donors can call to request pick up. Do a search engine search for "[name of charity] car donation" if there is a specific charity or type of charity to which you would like to donate your car.

3. Tell the customer service representative that the transmission on your car is broken. Most charities accept broken cars. When you donate the car, a contractor will come to your home with a tow truck and tow the car away. Typically the car is sold for parts, so it does not need to be in running condition. If the charity you called does not accept non-running cars, move on to Step 4.

4. 

   Call a different charity and ask if they accept non-running cars. The public television station WGBH in Boston, for instance, does accept non-running cars as long as the car has an engine and can be towed. 1-800 Charity Cars accepts non-running cars as well.

5. Schedule a pick-up time with a charity that accepts old cars that need a transmission. You will need to provide your Vehicle Identification Number (VIN) and any other information requested.

6. Meet the contractor at the scheduled time and provide the contractor with your signed car title. Request a receipt. You will be given a receipt proving that the car was donated.

7. Wait for a tax deduction notice from the charity. You cannot deduct the Kelly Blue Book, but rather the price paid at the auction of the car.

Tips & Warnings

• Remove the license plates before the contractor comes to tow the car. Return the license plates to your state's department of motor vehicles and request any prorated refund you might receive for your year's registration fees.
• Do not cancel the car insurance (if the car is currently insured) until after the contractor tows the car away. You cannot deduct the Kelly Blue Book value of the car. You can only deduct the amount that was paid at the auction. The charity will provide you with an official notice of how much the car sold for at the auction. This is your official tax receipt, and this amount is reported to the IRS by the charity.

References

• IRS Car Donation documents

Resources

• WGBH Car Donation
• 1-800 Charity Cars
• Does a Charity Car Donation Make Sense?