Donating your used car to charity is all the rage. You get a tax write off, and it’s way less hassle than selling it. Here are a few things to keep in mind about these transactions, so you know what you’re getting into:

1) Most cars are collected by third party organizations, not by the charities themselves. Many of these are for profit enterprises, and donate as little as 10% of your car’s sale price to charity. Others are non-profit, but don’t meet the standards of the Better Business Bureau or similar watchdog organizations. The Allstate Car Donation Association (which has many aliases) spends only about half of its income on programs, and compensates its CEO with $122,000/year, despite the fact that the entire operation pulls in only $1.8 million a year. Why would you want to give them your car?

Always ask how much of your car’s sale price goes to charity, and check them out at the Better Business Bureau’s Web site.

2) Most car donation operations don’t allow you to direct your donation to a specific charity. Since I wanted my donation to support Doctors Without Borders, I called DWB to find out how to make that happen.

3) You will only benefit from the tax write-off if you itemize on your taxes. Also, there has been a serious IRS crackdown on people overvaluing their vehicle donations, so be honest!

I recommend contacting the charity of your choice and getting a recommendation directly from them about where to donate your car.
A couple tips about your next car buy:

Make sure your car is getting maximum miles per gallon and is spewing a minimum of greenhouse gases into the environment. If you choose to belong to an auto club, dump AAA and go with Better World Club. They donate 1% of their profits to green causes, charge gas guzzlers extra to join, and they support the Clean Air act and public transportation (while AAA lobbies against these things.)

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