5 steps to avoiding scams when you say “I’m donating my car.”
“I’m thinking about donating my car” – when that thought starts running through your head you could be on your way to helping people who really need it in your community. Or you could be on your way to lining the pockets of some shady dealer posing as a charity. Look around. There’s no shortage of people fighting for your car donation. Sadly many of the so-called charities that call to you from local commercials and radio ads are false fronts - people who operate very profitable businesses by abusing loopholes in the laws regarding tax-deductible vehicle donations. All of them donate a fraction of their profits to charity - they have to in order to keep their status as a non-profit or charity. But the amount they donate to charity can be surprisingly low, sometimes as low as 10%. Some even form their own charity and staff it with relatives!
So how do you cut through the clutter to find the best legitimate charity for donating old cars? Here are 5 key points that will help you make sure your tax-deductible vehicle donations do the good you want them to:
1: Cut out the middleman
When donating old cars, donate directly to the charity whenever possible. Questionable car donation programs are almost always middlemen happy to take your tax-deductible vehicle donations, sell them, donate a small part to a non-profit, and keep the rest for “operating costs” When you deal with a middleman, the amount you donate gets sliced twice, once for the overhead of the middleman used car organization, and once for the overhead of the charity. Your gift goes a lot further when you give your car or truck to a charity that takes vehicle donations directly, like Volunteers of America Region. When you donate a car to Volunteers of America %100 of the money raised stays with Volunteers of America. We keep our operating costs low, so nationwide an average of 88% of donations are put into local programs like helping the homeless in Cities, permanent senior housing and programs in Seattle or Tacoma, and emergency food and shelter programs in places from Olympia to Edmonds.
2: Give your charity a thorough inspection
Finding the smartest charity for donating old cars doesn’t have to be a stab in the dark - the web has a couple of smart ways you can weigh and measure any charity you want to get involved with. The Better Business Bureau is a good place to begin. At bbb.org the Better Business Bureau evaluates charities on 20 Standards of Charity Accountability including the ways charities spend their money, whether the organization represents itself transparently, and the group's willingness to disclose financial information to the public. Another valuable resource for people looking to make tax-deductible vehicle donations is GuideStar Exchange, found at guidestar.org. GuideStar's mission is "To revolutionize philanthropy by providing information that advances transparency, enables users to make better decisions, and encourages charitable giving." We display the Guidestar and Better Business Bureau seals on all our web pages, which link to their reviews of Volunteers of America.
When you’re making any kind of tax-deductible vehicle donations, the bigger slice of your gift that goes into programs that help people in your area, the better. The IRS doesn’t have a standard percentage that a car donation program has to contribute to charity - believe it or not, some actually give less than 10%. When you're deciding about donating old cars it’s smart to take the time to investigate just what percentage of your used car donation will actually make it into programs that help people. Reputable charities will make that information available on their website, or in an online copy of their annual report. You can also find it online through the Better Business Bureau or GuideStar. Volunteers of America puts an average of 88% of all donations to use in life changing programs such as emergency food and shelter, senior housing, job training and youth services for nearly 2 million Americans, including thousands right here in Western Washington.
4: Look for local impact
If the charitable organization you’re thinking of donating a vehicle to is vague about the programs they offer and where they offer them, it can be a red flag. If you like the idea of helping people close to home, look for an organization that runs programs in your area or state. Making a tax-deductible vehicle donation to someone who runs a program close to you can provide another advantage - you can visit on the programs you donated to, and see how your donation is making a positive impact. Right here in Western Washington, Volunteers of America helps over 350,000 people a year. We serve thousands of meals a year to people fighting the tough economy, shelter thousands of homeless children, women and men while providing job training and other support, and provide permanent housing to seniors who might otherwise be forgotten.
5: Double check that the charity is designated as an official 501 ( c )(3) charity by the IRS
If you’re interested in tax-deductible vehicle donations, make sure your donated car goes to a 501(c)(3) charity - an official designation only the Internal Revenue Service can provide. If the used car donation program you’re looking into doesn’t have a 501(c)(3) designation, your deduction may be disallowed, and you could end up writing the IRS a check for unpaid taxes, plus interest and penalties. If you want a tax deduction for donating old cars, donate to an official 501(c)(3) charity
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Here are 5 critical ways Volunteers of America Western Washington rises above the scammers:
We eliminated the middleman
We don’t donate money to charity – we are the charity. When you donate old cars and trucks to Volunteers of America Western Washington, you are donating directly to a respected organization that helps hundreds of thousands of people right here in Washington
88% of all donations are spent on life changing programs
If you want to do the most good with your donation, you’re in the right place.
Volunteers of America helps 350,000 people a year right here in Washington
We pull together in Washington. Whether you make tax-deductible vehicle donations in Bellingham, Everett, Olympia, Edmonds, Seattle or Tacoma, you can be confident your donated car is helping people in your area.
Volunteers of America Western Washington is an official IRS designated 501(c)(3) charity