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Car donation, or the "sale" of a car to an auctioneer or junkyard (breaker), affords the benefit of a quick sale without creepy strangers crawling up your front steps. Besides, charities benefit from the proceeds of sale to some degree or another. Far from painless, car donation involves sketchy or tardy purchasers. Let me explain.

My 11 year old steed broke its pulleys and threw its belts off. In English, she had a heart attack. Not willing to pour $500 into a car already on life support, I left the car at my favorite gas station and called my favorite charity. The charity referred me to their preferred purchaser. Call the charity and purchaser ahead to find out how much of the proceeds of sale go to charity.

Due to the torture of the American tax code, car donation involves a non-cash transaction yielding a deduction on the next income tax return. The purchaser does not place a value on the car. Rather, the charity mails the seller a tax receipt. Based on prudent judgement the seller enters the book value, or trade value of the car, as the value on the return. In other words, my utterly dead car garners a book value of $2000 or so. I would get zippo on the open market as its a hurtin' cosmetically. After fiscal year 2004, the purchasing company will determine the value of the car, significantly reducing the donation value of most cars. jmpz has reminded me that sellers may make deductions in excess of $5000 with proof of a certified appraisal.

Be advised that the donation tow companies move with the impetus of a Soviet bread line. The company, headquarters in California and far from snowy Connecticut, referred me to a breaker located almost 70 miles (110 km) from my home. Efficient.

This audit's gonna be fun!

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