One of the bigger assets that most people will ever own is a car. While a car can last someone well over a decade and can be driven for more than 100,000 miles, there will come a time when you want to get rid of it. When you are looking to get rid of your car, there are several options that you will have.

While some will choose to sell their car to a private party or trade it in to a dealership, another great option would be to donate the car to charity. There are several reasons why you should consider donating your car.

Why Donate a Car?

You Will Make a Difference

One of the main benefits of donating your car is that it will allow you to make a difference in your community. There are a variety of charities that regularly accept cars as a form of donation. These charities including local charities that help to provide resources to those in need, charities that aim to cure certain diseases, and a variety of other charities.

Once you have donated your car to charity, the organization will sell the vehicle themselves and will be able to keep the proceeds from the sale. The money they receive from the sale can then be used for a wide variety of purposes to benefit the charity.


If you are looking to get rid of your car, you will find that the process of selling it to a private party can be stressful and exhausting. This process will require you to make sure that your car is clean and in good condition and also spend time and money marketing your car to try and find a buyer. You will then have to spend a lot of time haggling with buyers.

When you donate a car to charity, the process is simpler. Once you have contacted the charity, you can expect to have your car picked up within a few days. The charity will be able to come right to your home and have the car moved to their lot.

Tax Deduction

While it is great to help your community and a charity, an added benefit is that you will receive a tax deduction when you donate your vehicle. As long as the charity is certified by the IRS, you will be able to deduct the car from your federal tax return in the year that you donated it. This could end us saving you thousands of dollars through reduced federal and state income taxes.

Other Financial Benefits

Depending on the charity that you donate to, you can receive other benefits as well that could provide you with some value. Many larger charities have promotions running on a regular basis that will provide you with discounts or free services when you donate your vehicle to their charity. This can often include receiving a voucher for a free hotel stay or receiving a gift card that can be used at a restaurant of your choosing.

Can I Make Money from Donations?

When you are looking to donate your car to charity, the most significant concern is about how much of a deduction you will receive. The amount of the deduction that you can receive for your car is based on either the charity’s sales price of the car or the market value of the car. In most situations, you will be able to deduct the price that the charity gets when they sell the car. For example, if your car is worth $7,000 when you donate it and the charity sells the car for $5,000, you will only be able to deduct the $5,000 amount.

One caveat to the deduction amount is if your car sells for less than $500. If your car is valued at $700, but it sells for $300, you will be able to deduct $500 on your income taxes. Once the sale of the car is complete, the charity should be sending you a Form 1098-C, which you will need to have when you file your federal income taxes. You should continue to retain this form for up to seven years.

The actual financial benefit of the deduction will also vary based on your personal tax situation. The deduction will come off your AGI and taxable income. Therefore, if you are in the 25 percent tax bracket, you will receive 25 percent of the deduction amount back through reduced taxes.

Overall, donating a car to charity can be a great option as it will allow you to give back to the community while also reducing your tax burden. If you do choose to donate your car, it is important to make sure that the title is clean. You will not be able to donate the car if you have a loan or other lien outstanding.


This article was worked on by a variety of people from the Autoversed team, including freelancers, editors, and/or other full-time employees.