Vehicle Donation: Are the New Rules Good or Bad?

                                                                                         

Until recently it was particularly easy to cheat the laws governing vehicle donation. But now all of that has changed. In 2004, the federal government decided to intervene and altered the rules surrounding vehicle donations. Too many people were taking advantage of some of the loopholes in the auto donation rules and so the government decided to try and make the system foolproof. This has stopped people from abusing the tax laws associated with vehicle donation in order to get bigger tax relief than they deserve. Unfortunately, this has effected major charities such as Goodwill Industries and The American Red Cross as they are receiving fewer vehicle donations as a result.

This has people questioning whether government Intervention has been beneficial, by stopping people from abusing the system and evading tax payments, or decremental to the funding of the charities themselves. I now have a lot of hurdles to pass through if I want to donate my car to a charity. Many people now think that it is simply not worth the effort of filling in the paperwork and dealing with the many rules and regulations to claim the tax savings that they would be entitled to. The government has been successful in stopping people taking undue advantage of the system, that much is certain. Nevertheless, many now feel that they have overstepped the mark, including the charitable organizations that benefit from such donations.

But you shouldn't worry too much, if you do decide to donate your car you will still be eligible for a a tax break, so more valuable the car the bigger a tax cut you will get. To get the highest reduction in tax you need to get the best price for your car. Charities will sell the car and the money it raises will count as its current value in the eyes of the government. Because of this, you should choose a charity with a proven track record in achieving the highest price for used cars. Some charities are able to get a better price for a car than you would do yourself.

About the author:
Are you a philanthropist looking for ways to give back to your community? Visit http://www.charitydispatch.com to learn more about how you can do just that by donating your vehicle for a good cause.

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