How to Donate a Car
Donating a vehicle is straightforward — but the tax deduction rules are more complex than most people realize. Here is exactly how it works, and how to maximize your benefit.
How the Tax Deduction Works
| Scenario | Your Deduction | Example |
|---|---|---|
| Charity sells for > $500 | Actual sale price (per Form 1098-C) | Car sells for $2,500 → deduct $2,500 |
| Charity sells for ≤ $500 | Lesser of FMV or $500 | Car FMV $400, sells for $300 → deduct $400 (up to $500) |
| Charity uses the vehicle | Fair market value (FMV) | Car FMV $5,000, charity uses it → deduct $5,000 |
| Charity gives to needy individual | Fair market value (FMV) | Car FMV $3,000, given to family → deduct $3,000 |
How to Donate Your Car
Only donations to IRS-qualified organizations are tax-deductible. Use the IRS Tax Exempt Organization Search at apps.irs.gov before donating.
Most states require a clear title to complete the donation. If your title is lost, apply for a duplicate from your state DMV before donating.
Use Kelley Blue Book (kbb.com) or NADA Guides to determine your vehicle's fair market value. This matters for vehicles the charity will use operationally.
Most major charities offer free vehicle pickup in 24–48 hours. You can also drive the vehicle to a donation center.
The charity will have you sign the title. Get a dated receipt acknowledging the donation. Request the Form 1098-C be sent promptly after the vehicle is sold.
File a notice of release of liability with your state DMV so you are no longer responsible for the vehicle after donation.
Attach Form 1098-C to your federal return. The deduction is the lower of your cost basis or the charity's actual sale price (for vehicles sold over $500).
Car Donation by State: Featured States
Frequently Asked Questions
How much can I deduct for donating a car?
If the charity sells the vehicle for over $500, you deduct the actual sale price (not the fair market value). If sold for $500 or less, you deduct the lesser of fair market value or $500. If the charity uses the vehicle operationally or gives it to a needy individual, you can deduct the full fair market value. Form 1098-C from the charity is required for vehicles over $500.
Do I need to itemize to claim a car donation deduction?
Yes. Vehicle donation deductions are itemized deductions on Schedule A. If your total itemized deductions (mortgage interest, state taxes, charitable contributions, etc.) exceed the standard deduction ($14,600 for single filers in 2024; $29,200 for married filing jointly), itemizing is beneficial. Otherwise, the car donation provides no federal tax benefit.
What is Form 1098-C?
Form 1098-C is the "Contribution of Motor Vehicles, Boats, and Airplanes" form that the charity must send you within 30 days of selling the vehicle. It shows the actual sale price. You need Copy B of this form to attach to your federal return (or keep records if e-filing) to claim a deduction for vehicles valued over $500.
Is it better to donate or sell my car?
It depends on the vehicle's value and your tax situation. Donation makes most sense when: the vehicle is hard to sell privately (old, damaged, or low value), you itemize deductions, or the vehicle has high fair market value and the charity will use it operationally (maximizing the deduction). For mid-value vehicles ($5,000+), a private sale often returns more cash than the tax savings from donating.
Can I donate a car that does not run?
Yes. Many charities, particularly through programs like Cars for Kids and Vehicle Donation Processing Center, accept non-running vehicles and arrange free towing at no cost. A non-running vehicle will typically sell for scrap value ($200–$500), which becomes your deductible amount.
Can I donate a car without a title?
It is difficult. Most charities require a clear title to accept a vehicle. Without a title, the charity cannot re-title the vehicle for resale. If your title is lost, apply for a duplicate from your state DMV before donating. Fees range from $5 (Ohio) to $75 (Florida). A few charities in some states will accept vehicles without titles if they go directly to salvage.