How to Donate Your Car to Charity

Many people want to give back during the holiday season by volunteering and donating money.

Did you know that you can also donate your car to charity? If you go this route, the charity then has the option of keeping the car or selling it.

Before you donate your car to charity, there are a few things you’ll want to keep in mind.

The groundwork

  • Make sure the organization is a registered 501(c) 3 that is eligible to receive tax-deductible contributions. Ask to see the organization’s IRS letter that verifies its tax-exempt status.
  • Vet the charity. lets you view a nonprofit’s 990 financial statements while assesses how well organizations use donations.
  • Check to see if the organization accepts cars. Not every charity wants your old car. From a personal tax perspective, it is best for the organization to use your car or to give it to a person in need. Otherwise, your deduction will be limited to what the charity sells your car for rather than its fair market value.

    If you want to help an organization that doesn’t accept cars, you can consider selling your car and donating the proceeds to the organization.

The donation process

  • Be wary of car donation agencies. These middleman businesses promise to handle the donation process for you. There are no IRS rules stipulating how much of the proceeds from the car’s sale they need to give to a charity. If you go this route, use caution and find out exactly how much of your car’s proceeds go to charity.
  • Maximize the donation by delivering the car yourself. If a charity has to pay to transport your car, it will cut into the donation you intended to give.
  • Correctly transfer title of the car to the charity. It’s critically important to transfer title of the car to the charity. If you don’t, you could be held responsible for traffic tickets and potentially even crimes committed by someone driving the car after you donate it to a charity.

The tax deduction

  • Get a receipt for the donation. Remember that it’s the donor—not the charity—who answers to the IRS. A charitable car donation is one of the more common transactions that trigger an IRS audit. So make sure to get a receipt and hang on to it for at least seven years.
  • Fill out the right paperwork. The IRS requires certain documentation to accompany any car donation valued over $250. Visit to obtain the correct forms.

    The IRS also publishes two pamphlets which provide detailed information regarding the requirements to obtain a tax deduction if you donate a car or other vehicle to charity. These IRS publications are 4302 and 4303.
  • Keep photos and old receipts. Photos of your car, along with receipts for things like new tires and other improvements, help support the car’s value if you’re ever challenged by the IRS in the future.

If you decide to donate your car to charity, don’t forget to contact your insurance agent so he or she can terminate coverage on your old car.

Once the donation is complete, you may be in the market for a new car—and new auto insurance. For great coverage at a great price, contact a local Erie Insurance Agent in your area for a free auto insurance quote.

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