Making Sure Your Car Donation Is Tax Deductible
Do you have a vehicle that is going unused? Take it to a charity that accepts automobiles and you can receive a huge tax deduction come tax season. The whole purpose of doing it should not be what you get back but rather what you give. If you are doing it for any other purpose you may not have the best intentions.
If you think you are the only one with tax deadlines, you are not. In a wickedly funny twist, the IRS also has them. Specifically, they have to get all the tax forms for the year printed up by November of the previous year. Since there are millions of tax forms that have to be produced, Congress makes an effort to make the relevant tax changes before forms have to be printed each November. Well, not this year. Before losing control of Congress, the Republicans went nuts. While this has caused a problem for the IRS, it has really caused a problem for you. Why? Well, the tax forms are wrong in certain areas. Here are some highlights.
The last thing that we can say that may help you is to record all figures from the car being donated date, mileage and other figures that prove the valuation is an accurate one. Take photographs of the interior and exterior of the 2011 lincoln town car.
Charity, as we hope everyone recalls, begins with a tax deduction. If you didn't have the cash to give in 2008, let's hope you charged it. And, likewise, if you don't have the cash when it comes time to contribute in 2009, charge it. The deduction is permitted in the year of the charge, not when you actually pay the bill.
Let's also say that their mortgage interest is $11,215. If they deduct the entire $11,215 interest from their $100,000 income, their taxable income is $81,670, not $100,000. Note, they deduct the interest off their taxable income, not off their owed taxes. That's why the savings is not dollar-for-dollar.
Although this is a charity event and you are using volunteers, I do recommend creating a professional schedule and try to pin down what days volunteers can help. Most people understand you will need to create a real schedule in order for the event to work well.
On the other hand, if you are planning to make improvements to your office and/or equipment in the next year or two, it might make sense to do it in 2008 so the Government can underwrite a substantial portion (35-50%) of the cost.
If you think you are the only one with tax deadlines, you are not. In a wickedly funny twist, the IRS also has them. Specifically, they have to get all the tax forms for the year printed up by November of the previous year. Since there are millions of tax forms that have to be produced, Congress makes an effort to make the relevant tax changes before forms have to be printed each November. Well, not this year. Before losing control of Congress, the Republicans went nuts. While this has caused a problem for the IRS, it has really caused a problem for you. Why? Well, the tax forms are wrong in certain areas. Here are some highlights.
The last thing that we can say that may help you is to record all figures from the car being donated date, mileage and other figures that prove the valuation is an accurate one. Take photographs of the interior and exterior of the 2011 lincoln town car.
Charity, as we hope everyone recalls, begins with a tax deduction. If you didn't have the cash to give in 2008, let's hope you charged it. And, likewise, if you don't have the cash when it comes time to contribute in 2009, charge it. The deduction is permitted in the year of the charge, not when you actually pay the bill.
Let's also say that their mortgage interest is $11,215. If they deduct the entire $11,215 interest from their $100,000 income, their taxable income is $81,670, not $100,000. Note, they deduct the interest off their taxable income, not off their owed taxes. That's why the savings is not dollar-for-dollar.
Although this is a charity event and you are using volunteers, I do recommend creating a professional schedule and try to pin down what days volunteers can help. Most people understand you will need to create a real schedule in order for the event to work well.
On the other hand, if you are planning to make improvements to your office and/or equipment in the next year or two, it might make sense to do it in 2008 so the Government can underwrite a substantial portion (35-50%) of the cost.