As with many charities there is a lot of money spent on acquiring donations. In fact, some charities spend the majority of their funds on acquiring more donations – leaving a lot less for the actual charity recipients themselves. This is why some people choose not to give to charities that solicit donations.

With the car donations, it is even worse. There are many For-Profit companies that advertise as a means of donating your car to charity and they leave very little left for the charity. They typically leave the charity 50% to as little as 10% of the value of the car – and keep the rest as their revenue.

The better way to find a place to donate your car

Since the charity car donation thing has gained so much interest, quite a few charities now have this as an option – even though you may never see them advertise it. So, next time I donate a car, I am going to call charities that I am already familiar with and trust and ask them if they accept car donations. Not every charity will accept them, but you might be surprised how many do.

To find great charities check out Charity Navigator or the BBB.

Drop the car off – if you can

While it may seem obvious, it is a better idea to drop the car off at the charity rather than having it picked up. Your car won’t be picked up for free – they will incur some kind of expenses picking up your car from your house – and these are dollars that won’t be going to the charity recipients. So, if you have the means, dropping it off would probably be a better move.

Transfer of Title

In order for the charity to become “legal” owners of the vehicle, they are going to need to title. It is a better idea to fill out the transfer of ownership section rather than leaving it blank. And it may be a good idea to let the DMV know the transfer as well. If the car has a license plate, you’ll need to return the plate to the DMV (depending on state), and may even need proof of the “method of disposal”.

Taking the tax deduction

According to MSNBC, “If your donation is worth more than $500, you’ll have to attach IRS Form 8283 to your tax return. If it’s worth more than $5,000, your documentation must include an outside appraisal. You’ll also need proof of the donation, such as a receipt from the charity and a copy of the title change.”