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Vehicle Donation Information Lahaina HI

Atypical for our tax system, taxpayers are actually encouraged to help others through deductions. Here's the latest tax information on donating vehicles to charity.

H & R Block
(808) 935-2799
910 Honoapiilani Hwy Ste 11
Lahaina, HI
 
Hutchinson Paul M
(808) 244-7902
24 Market St
Lahaina, HI
 
Burstyn & Associates Business Consultants Inc
(808) 661-3961
991 Limahana Pl Ste H4
Lahaina, HI
 
Jmp Svc Inc
(808) 270-2710
811 Kolu St Ste 103
Wailuku, HI

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Comte John M
(808) 244-8128
776 Analio St
Wailuku, HI
 
Shue C Douglas
(808) 661-3231
425 Ilikahi St
Lahaina, HI
 
James & Associates Cpas Inc
(808) 667-9512
505 Front St Ste 222
Lahaina, HI
 
Beck Robert Tax And Bookkeeping Service Inc
(808) 242-1553
2070 W Vineyard St
Wailuku, HI
 
Cheatham Jon B Cpa Llc
(808) 249-2720
2200 Main St Ste 504
Wailuku, HI
 
H&R Block
(808) 893-0100
89 HOOKELE ST STE 104
KAHULUI, HI

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Vehicle Donation Information

Donating Vehicles to Charity

Atypical for our tax system, taxpayers are actually encouraged to help others through deductions. Here's the latest tax information on donating vehicles to charity.

Traditionally, a taxpayer was given a windfall when donating a vehicle to charity. Regardless of the condition, one could claim a deduction for the fair market value of the car. Obviously, the fair market value of a car is a bit of a vague figure. Alas, the IRS has issued new regulations clamping down on unrealistic fair market value claims.

Under the American Jobs Creation Act, the method for valuing a vehicle donated to charity has changed. Instead of claiming fair market value, now you can only claim the actual sales price the charity gets when selling off the car. Put another way, the old rust bucket in the driveway just lost a lot of value for tax purposes.

It is unclear why a "jobs act" would have language related to vehicle donations. Alas, it does. Not only are you restricted to claiming the actual sales price of the vehicle as a donation, you must also take an extra step. You are now required to obtain and retain written and timely acknowledgment of the sales price from the charity of the sales price. If the IRS ever audits you, the receipt needs to be included in your records.

For the fortunate few, there are two exceptions to the new actual sales price rules. The circumstances that will give rise to the exceptions seem pretty far fetched, but you might be the lucky donor.

First, you can claim the fair market value as a deduction if the charity significantly uses the vehicle for its own purposes before selling it. For instance, if the charity uses it for a few months to deliver meals or carry out administrative needs, you get the fair market deduction. Make sure you get something in writing from the charity to back up the deduction claim!

Second, you can claim the fair market value deduction if the charity makes material improvements to the vehic...

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