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Planning to Donate a Vehicle
For Tax Deduction Benefits?
Edmunds.com Advises Consumers
How to Survive an Automotive Audit
By Jeannine Fallon
A popular way to achieve tax relief is to donate an old car
to charity. However, according to a release issued in December
2001, the Internal Revenue Service (IRS) is paying close attention
to the value placed on donated vehicles. Edmunds.com, the
Web's leading consumer resource for unbiased automotive information,
offers pricing tools that can help in the process of deducting
a vehicle.
"Taxpayers who itemize deductions on their tax returns
can deduct, within limits, the fair market value of their
contributions to qualified charities," according to the
December 3 press release titled "IRS and State Charity
Officials Urge Care When Making a Car Donation." The
release goes on to warn, "The fair market value of the
taxpayer's car may be substantially different from the 'Blue
Book' value."
According to IRS Publication 561 titled "Determining
the Value of Donated Property," "Fair market value
is the price at which property would change hands between
a willing buyer and a willing seller, neither having to buy
or sell, and both having reasonable knowledge of all the relevant
facts."
The Edmunds.com True Market Value® (TMV®) automotive
pricing tools were developed to provide this type of information,
serving as the industry's best guide to market value pricing
and the only pricing system designed with the consumer in
mind.
The IRS directs taxpayers to consider a full range of criteria
such as accessories, mileage and condition in determining
the appropriate value of their vehicles. The TMV Used Vehicle
Appraiser asks for these and other facts about each vehicle,
then provides a valuation report. The report may be of use
in preparing your return, and it is a good practice to keep
it with your tax papers in the event of an audit. As with
all tax matters, you should always consult a certified tax
advisor.
"The TMV is, in essence, what you would expect to pay
or receive for your vehicle given current market conditions,
and it should be useful in approximating the value the IRS
expects you to claim," according to Jeremy Anwyl, president
of Edmunds.com.
The Used Vehicle Appraiser presents each user with three sets
of TMV prices representing the three types of used vehicle
transactions: dealer trade-in (what you should expect to receive
from the dealer as a trade-in), dealer retail (what you should
expect to pay a dealer for this vehicle), and private party
(what you should expect to pay or receive in a private party
transaction). Anwyl suggests that taxpayers take all three
values to their certified tax advisor when determining their
deductions.
There are a number of private charitable organizations that
offer car donation programs.
www.specialkidsfund.org
_______________________________________________________________________
Special Kids Fund is providing those making car donations
with the following link to search for Federal Form 8283 for
itemized deductions
http://www.irs.gov/index.html
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You may claim the "fair market value" for your
vehicle; to assist you, here is the link to “True Market
Value” at Edmunds 
