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Helpful Informational Links about Car Donations and Values
o. AutoTrader

o. Better Business Bureau

o. Carfax, Inc

o. Consumers' Checkbook - CarBargains

o. Edmunds.com, Inc.

o. Federal Consumer Information Center

o. Kelly Blue Book

o. National Automobile Dealers Association (NADA) Guides Online

o. National Highway Traffic Safety Administration

RECENT NEWS STORIES

Donated Cars A Boon For Charities
Hartford Courant
August 13,
By SEFIRA FIALKOFF, Courant Staff Writer

Car donations have become an increasingly popular way for people to unload their old cars for a tax write-off and for nonprofit organizations to raise money. But some nonprofits worry that stricter enforcement of tax laws by the Internal Revenue Service could put a dent in the car donation process and affect what the organizations receive.

Michelle Lettieri, executive director of Mothers Against Drunk Driving in Fairfield, said car donations have been a lifeline for MADD, netting the group about $50,000 a year in Connecticut. MADD uses Cramer's Auto and Recycling, an independent car donation service that handles the process at no cost to the organization.

"We don't have to assign someone the job of dealing with car donations or rely on volunteers to fix up the cars for us," Lettieri said. "All we do is give people the number of the car program, and then we hopefully receive a check in the mail from the program a few weeks later."

Companies such as Cramer's pick up donated cars, calculate their value, perform any needed repairs and sell them at auction - or for parts or scrap. Then they send a percentage to the nonprofit organization; the percentages vary depending on the organization's specific contract.

But the practice of donating cars for tax deductions has come under increasing scrutiny. Dianne Besunder, IRS spokeswoman for Connecticut, said the government is concerned that donors sometimes claim too much on their tax returns, so the IRS has issued a number of consumer alerts for the public and charitable organizations.

"What we're trying to tell them is that it's up to the individual to make sure their deduction is equivalent to the fair market value of the car," she said. "We want people to get the correct tax deduction when they're entitled to it, but not to claim more than a car is worth, because if you make a mistake on your tax return form, you could be audited and have to pay taxes, additional interest and possibly other penalties."

Several nonprofit groups said that the IRS has told them to advise donors to use the Kelley Blue Book to value their cars, and that they expect the whole process may become more tightly regulated.

Elena Tamayo, development assistant at the Multiple Sclerosis Society in Norwalk, said the donations are "a great example of small things that people can do that really add up and make a difference. If people donate a vehicle, even one run into the ground, we'll receive a few dollars. Even cars that are small and may be seen as junk really do add up into enough money that really, truly makes a difference."

Most car programs also accept trucks, boats, motorcycles and RVs - even small airplanes.

"We've received a few boats, but they're generally broken-down and not worth as much," said Tamayo, who donated her own 1992 car to the MS Society. "We've had people donate three cars in one year."

It would have cost Sarah Torrence of Farmington about $75 to have her 1988 Subaru XT hauled to the junkyard. Instead, she donated the car, which had more than 100,000 miles, to the American Cancer Society three years ago.

"It was an old car, probably 12 years old, and not worth the money to me to keep repairing it," Torrence said. "The car really wasn't worth a whole lot. In a way it surprised me that it was worth it to them to tow it away."

Torrence said she simply called up the American Cancer Society and asked them if they wanted her car.

"They did, so I just mailed the title to them and left the keys in the car on the day they said they'd come pick it up."

Unlike many people who give away old vehicles, Torrence wasn't looking for a tax deduction for her donation.

For nonprofit groups such as MADD and the Multiple Sclerosis Society, which have been accepting car donations for almost four years, the car donations raise thousands of dollars each year. Last month, 40 cars were donated to the MS Society, and, Tamayo said, the group collects up to 80 cars a month during tax season.

But groups that are newer to car donations sometimes start out slowly.

Jane Ellis, executive director of the Connecticut Sports Foundation Against Cancer, said her organization received only 10 cars in the past year, for a total of only about $2,000.

"It started out with a bang. ... Unfortunately, our first check was probably 90 percent of what we've received this whole year," Ellis said. "The percentage that we receive from the car company is very small once they take out administrative fees.

"We had great hopes for this program, but we've been disappointed."

Even so, she added, the foundation plans to continue accepting donations.

"It doesn't cost the foundation anything," she said. "It's really not an involved administrative process for us. We're hoping more people in Connecticut donate and it becomes more profitable."