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FREQUENTLY ASKED QUESTIONS - HOW YOUR VEHICLE DONATION AFFECTS YOUR TAXES

HOW MUCH WILL I RECEIVE AS A TAX DEDUCTION FOR MY CAR?

First fruits ministries is a tax-exempt 501(c)(3) organization of the Internal Revenue Code which is commonly referred to as a charitable organization. 501(c)(3) organizations are eligible to receive tax-deductible contributions in accordance with IRS Code.

This means you can donate a car and be eligible for a tax deduction.

NOTE: The information below is intended to provide general information only and is not intended to be tax advice. Check with your tax advisor or tax preparer to determine your tax deduction eligibility.

Generally, when your vehicle is sold, the IRS limits your tax deduction to the gross proceeds the charity receives from its sale. Specifically;

• If the donated vehicle is sold for $500 or less, you can claim the fair market value of your vehicle up to $500 or the amount it is sold for if less than fair market value.


• If the donated vehicle sells for more than $500, you can claim the exact amount for which the vehicle is sold.
The above conditions will apply if your donated car is sold for scrap because the car repairs are too expensive to make the car road safe.

However, the IRS provides the following exceptions that allow donors to claim a deduction of the vehicle's fair market value under the following circumstances:

• The charitable organization makes certain use of the car in charitable deeds.


• The charitable organization increases the value of the vehicle significantly through repairs (not just cleaning or painting).


• The charitable organization donates or sells the vehicle to an individual in need for a very low (below market) price for the purpose of helping them with transportation.

WHAT PAPERWORK IS NEEDED TO SUPPORT THE TAX DEDUCTION FOR MY CAR?

If your donated car sells for $500 or less, you are allowed to claim up to $500 on your tax form and will need the following documentation:

• The name of the charity, information of your donated vehicle, and information if any goods or services were received and what their value was.


• This information is typically found on the receipt that will be sent to you.


• If your donated cars sells for more than $500 but less than $5,000 generally you are allowed to claim the precise dollar amount that your car was sold for.

NOTE: Since first fruits ministries will sell the vehicle to an individual in need for a very low (below market) price for the purpose of helping them with transportation, the IRS will allow donors to claim a deduction of the vehicle's fair market value.

You will also need the following documentation provided by first fruits ministries:

• The name of the charity, information of your donated vehicle, and information if any goods or services were received and what their value was.


• Form 1098-C or a legal substitute like the receipt from the charity.


• If you are filing on-line, you will need Form 8453.

IMPORTANT: If your donated car sells for OVER $5000, you will also need:

• IRS Form 8283 signed by an official of the charity.


• Form 1098-C or a legal substitute such as the receipt from the charity.