Donating a car? How much money does the charity get?

They’re everywhere – ads asking you to donate your old car or truck to a charitable organization. When you see this much advertising on any subject, you can be certain that it is generating revenue. Organizations don’t pay for advertising if it doesn’t bring in money. In 2008 alone the IRS reports that US taxpayers donated over 443 million dollars worth of old vehicles.

Most people who donate a car are looking for a tax break or looking to get an eyesore out of their driveway. But they also donate cars to charity because they want to help others. So the question becomes: What percentage of the money earned from donating a car actually goes into programs that help people?

The answer to that question can be difficult to pin down – and the more difficult it is to pin down, the more wary you should be about the ‘charity’ you’re thinking of donating to. The first thing you need to check out – are you donating directly to the charity, or to one of the countless charity car donation middlemen out there?

It doesn’t matter whether the organization is classified as a 501(c)(3) or not – if the organization you’re thinking about donating your car to uses language like ‘Your donated car can benefit any charity, school or church that you choose’, or ‘choose from a list of charities’ – you’re dealing with a charity car donation middleman. Some middlemen are even more vague about what they do with your money.

So what’s the problem with donating your car to a middleman car donation organization? The problem is that before the middleman donates the funds from your donated car, they subtract money to pay for marketing, operating costs, and their salary. In some cases these middleman car donation programs keep more than 70% of the money they earn.

Most never disclose how much money they take off the top. Because they know their donations would dry up if people understood that less than 30% of the money raised from donated cars actually goes into programs that help people. And after the charity subtracts their own operating costs, the amount going to help people gets even smaller.

Here’s how to make certain your car donation does the most good. First, avoid the middleman. Donate your car or truck directly to the charity you want to benefit. Second, do a little homework. There are a couple of great online tools you can use to make sure the charity you’re thinking of donating a car to is on the level. Go to GuideStar.org or the Better Business Bureau online at bbb.org and search for the organization’s name. If they have a questionable report, don’t give. If they don’t have any report at all, don’t give.

Most reputable charities will tell you what percentage of donations go to programs that help people on their website or in their annual report. If that information is hard to find, or missing altogether, that’s another red flag that your donation may be going into someone’s pocket instead of programs that feed the hungry or shelter homeless children.

Done right, donating a car to charity is a win-win situation. You get a nice tax deduction and the charity gets the money they need to help people. It pays to take a little extra time to make certain you’re doing the most good with your car donation.

Unlike middleman charity car donation organizations, when you donate a car at CarsHelpingPeople.org, 100% of your money stays with Volunteers of America, and 88% is used for locally run programs that help people. CarsHelpingPeople.org is the car donation program of Volunteers of America, one of the oldest and most respected charities in the nation. Volunteers of America helps millions of people a year coast to coast through locally run programs supported in part by donated vehicles. For well over a hundred years VOA has been a leader in helping children at risk, homeless men, women and families, veterans and senior services. Whether you’re looking to donate a car in Washington DC, are thinking I want to donate a car in Michigan, want to donate a car in New Jersey, Pennsylvania or Delaware, or are looking to donate a car in Virginia, Maryland or Nevada, just click here to donate a car, or call us toll free at 877-721-4862.

{ 1 comment… read it below or add one }

rhinestone December 18, 2012 at 5:43 am

This web site definitely has all of the info I needed about this subject and didn’t know who to ask.

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