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You 've seen the ads : " Donate your car to charity in California and get a" tax break Technically , it's true , "says Bob D. Scharin , senior tax analyst from the Tax & Accounting business of Thomson Reuters.


" But some people who give away an old car could find them smaller than expected tax break . And some donors, through the intricacies of vehicle gift guidelines , might be able to increase their deduction amounts ," he said .

You could ask the fair market value of the old car , this is the amount a willing buyer would pay a willing seller for the product. In general, you want to steer the evaluation of automotive services, such as Kelley Blue Book , to get an idea of the value of the car donation , donate to your favorite nonprofit and then hunt with a reduction tax equal to the amount of the assessment . No more.

Because some taxpayers become greedy, claiming much more than their old cars worth , lawmakers tightened the rules on how much you can deduct for a gift of a vehicle.

Now tax relief depends on the value claimed by the donor of the gift and how the body uses the vehicle.

" This puts taxpayers in the unusual situation of not knowing the size of the deduction when they make the donation ," says Scharin .

In most cases , the taxpayer must take into account a threshold of $ 500 in gift vehicles. The amount of value applies to cars, boats and even airplanes . When the value of a particular vehicle (based on the fair value analysis of credible market ) exceeds this amount, claiming the deduction becomes more complicated.

This assessment cap comes into play when a charity sells a donated vehicle . In this case, how a taxpayer can deduct depends on the amount of net sales .

For example, you give your old break worth $ 1,000. Under the old rules , it would be the amount you can deduct. But now , if the organization around and sells your donation of $ 800 , the deduction is limited to the selling price less

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