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Donating a car and IRS tax laws

Discussion in 'Prime Main Forum (2017-2022)' started by Sid786, Sep 11, 2017.

  1. Sid786

    Sid786 Active Member

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    Anyone has any past experience in donating a car. Since I now have my Prime, I would like to donate the car. It is a pretty old car 99 Mazda 626 LX (162k miles), although it is in running condition.

    After reading IRS website, it looks like that I can only claim a max of $500. But if the car is donated to a charity, which gives this car to a family then I can claim a max of upto $5000 depending on the Blue Book value. If the charity ends up auctioning the car, then I can only claim upto $500.

    If you have a past experience, then please do share your experience. I need to get this done, before the snow starts.
     
    #1 Sid786, Sep 11, 2017
  2. Mark57

    Mark57 2021 Tesla Model 3 LR AWD

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    Yeah, it's called a trade in. ;) Sorry couldn't resist.

    I can say be careful how much you claim as this will increase your audit chances. Document everything out the wazoo in case you are challenged later.
     
    #2 Mark57, Sep 11, 2017
  3. dalcon95

    dalcon95 Senior Member

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    Also consider, while donating, that you would lower tax liability which can also lower your federal tax credit for buying the Prime. If it won't lower your tax liability below $4502, then there isn't an issue or if you choose to claim the tax credit for buying the Prime.

    #1 in Easley,SC
     
    #3 dalcon95, Sep 11, 2017
  4. RRxing

    RRxing Senior Member

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    I've donated a couple of cars to charities for the tax deduction. The charity will send you a letter with the price sold at the auction. The IRS explains the process in the attached pdf...
     

    Attached Files:

    #4 RRxing, Sep 11, 2017
  5. Sid786

    Sid786 Active Member

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    Prime Advanced
    Awesome. Good stuff.
     
    #5 Sid786, Sep 11, 2017
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