How to Determine the Charitable Donation Value of a Modified Car?
When you donate a car to a charity, the IRS allows you to claim the fair market value of the vehicle on your taxes. According to the IRS, fair market value is the amount the modified car would sell for in a normal market where neither the seller or buyer is desperate for the sale. The value is not the same as the price paid for the vehicle as well as the price of the modifications. In fact, the charitable donation value is typically a lot less than the price paid for the vehicle and the modifications.
Other People Are Reading
Instructions
-
-
1
Check the base price of the car without modifications. Use the "Private Party Value" on the Kelly Blue Book website (see Resource section). Alternatively, use the used car pricing guide on the NADA Guides website (see Resource section). This tells you the value of the car without modifications.
-
2
See what other modified owners are selling their used modified cars for on Modified Car Trader (see Resource section). Be sure to look for cars with modifications similar to yours. Also check for modified car listings on eBay. The prices should be higher than the values from Kelly Blue Book and NADA Guides.
-
-
3
Take the modified car value amounts that you got and add them together with a calculator. Divide that total by the number of values that you added to get the average. Use the average as the value of the donated modified car.
-
1
