Vehicle donation in itself is something that has become popular over the past decade, but it has become somewhat less prevalent in the last five years. Ever since the federal government decided it was best to close down some of the most popular loopholes in the system, people have been less and less willing to give their old vehicles out of the goodness of their heart. In short, auto donation has not gone away by any means, but there has been a shift in what people are donating. Today, when most people donate a car to charity, they are donating something older.

The cutoff occurs at a very low number. In fact, old junkers are worth exactly $500 in tax deductions according to the federal government. This is something that people have taken advantage of late in the tax season because it gives them added flexibility in their reporting. If you talk to the people at charities like Goodwill Industries, they will tell you that any donation is a good donation. In down economic times, people are much less likely to give away their valuable items, even if those items have just been sitting in an abandoned yard.

However, if I wanted to donate my car to charity, I might think about donating an old clunker. If the car will no longer run and it will cost more to have it fixed than it is actually worth, then it makes complete sense to claim the $500 tax deduction. The chances of selling one of the vehicles is very slim and if you are not going to get it fixed, then it really is just an eye sore. That is why, according to those in the charity world, auto donation has taken something of a shift here recently.

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