Lung Association

National Kidney Foundation NY/NJ

Other Recipients

How to Do It

A Dealer’s Deal

Corrections or additions?

These articles by Barbara Fox were published in U.S. 1 Newspaper on September 2, 1998. All rights reserved.

Keep Your Clunker? Why Not Donate It?

In my family we keep our cars until they die on the road. Literally die. My clunkers always collapse when I am alone and far from home. For instance, my gas tank fell to the asphalt when I was on a deserted road, at night, in a South Philadelphia marsh famous as the favorite place for murderers to dump corpses. Several years later, at a busy intersection on Route 301 in Delaware, on a day when the temperature was 98 degrees, and when the telephone company was on strike, my engine caught on fire and totaled the car.

But for eight years now I have driven a very sturdy white Ford Taurus station wagon, affectionately dubbed "The Egg." In 1990 it was my first new car ever; all my other cars have been hand-me-downs. It has scrapes on both doors (don't ask why) and a coffee stain on the front seat, but I use a premium brand of oil, and it runs like a top, so far.

Yet at 96,000 miles I fear The Egg is approaching clunker-hood. Simultaneously I am approaching senior citizen status. Clunkers, I think, are not appropriate for senior citizens who take long trips. Should I run The Egg into the ground until it collapses? Trade it on a newer used car? Or respond to the advertisements and public service announcements urging me to donate my car to charity?

Ready to say goodbye to your old car? asks the National Kidney Foundation in a press release. "Put some `good' in the goodbye."

Don't Trade It -- Donate it, says the American Lung Association in a two-inch, two-column newspaper advertisement. "Get a tax write-off. We take almost any car."

Donating a vehicle, I discovered, is a free-and-easy way to get rid of a vehicle you don't want, if you are:

Spending too much on repairs.

Not happy with the trade-in value offered.

Unwilling to sell it yourself because of the time required, expense, loss of privacy, and possible security risk when dealing with strangers.

Tired of paying for an infrequently used vehicle -- registration fees, property taxes, and insurance premiums.

Looking for a tax deduction.

Interested in supporting programs and services of a particular charity, any charity certified as a 501 (c3) tax-exempt organization -- or a religious organization.

Car donations are getting to be more popular for tax purposes. Right now, only the 25 percent of Americans who itemize deductions can subtract for property donations ranging from land to cars to household goods. The Chronicle of Higher Education suggests that this represents a loss to the U.S. Treasury of about $14 billion a year, and Congress is considering extending that deduction option to everyone.

"If you are in a 40 percent tax bracket," says John Stahl, general manager of Princeton Nassau Conover Ford Lincoln Mercury, "the deduction on a 1987 Dodge Omni worth $2,000 at retail is worth far more than the trade-in value of only $400." Forty percent of $2,000 is $800 of your tax bill. For those in the 28 percent tax bracket, the deduction would be $560. Watch out, though. Donation of more expensive cars jeopardizes your savings on the sales tax when you buy a new car. (See side bar.)

So I began to think more seriously about a donation. Any charity can accept car donations, but four Princeton-area chapters of national charities actively solicit them with newspaper ads and press releases: American Lung Association, American Cancer Association, National Kidney Foundation, and Big Brothers & Big Sisters.

With the idea that one of them might allow me a better tax deduction than another one, I responded to all four but learned that they all require you to put your own "fair value" on the car. Basically they give you a book value and tell you to allow for condition and options. If you overvalue your donation, it's on your conscience, not theirs. (An alternative is to go to a car dealership like Stahl's; he appraises six or seven cars a year as a courtesy for area charities.)

All four charities use a car broker to dispose of the cars by selling to dealers, and three of them use the same broker. In contrast American Lung claims that because it runs its own in-house donation brokerage, it has lower overhead, so more money gets to the charity.

All give similar instructions:

Request a donation package from the charity.

Go to the Kelly Blue Book or the NADA official used car guide or use the estimates they send . (American Lung Association is particularly helpful about providing good fair-market-value information.)

Make copies of the title and any lien releases for your own records .

Send them with the odometer statement by certified mail.

Remove the plates and wait for a call from the towing service to schedule the free pickup.

Cancel your insurance on that car. File the charity's donation statement with your tax papers.

Here are some of your options.

Top Of Page
Lung Association

American Lung Association, , 586 Main Street, Suite 108, New York Mills NY 13417. 800-577-LUNG (5864). New Jersey chapter, 29 Emmons Drive, Suite A-1, Princeton 08540. 609-452-2112; fax, 609-951-9237. Elaine R. Fisher, director of field support services, mid-New Jersey region. Programs help people with asthma and other lung diseases and prevent kids from starting to smoke.

The only requirements are that you have a certificate of title, an engine in the car, and that the car have four inflated tires at the time of pickup. "We have done very well with the car donation program," says Elaine Fisher, director of field services for the American Lung Association of New Jersey, one of 13 lung associations belonging to a regional center that handles the car donations. "In the past three years, 1,400 cars have been donated, 94 in April, 1998, and 155 last December. In 1997 we averaged 70 per month."

Fisher has worked at the ALA for 19 years; she began by doing smoking cessation programs. Formerly overweight and a smoker, she now runs three miles a day, lifts weights, and is dedicated to "clean lung" causes. "Both my parents had lung diseases," she says. "My father was a coal miner and had pneumoconiosus, and my mother developed chemical asthma due to chemicals she inhaled while cleaning college dorms."

Tom Horan directs the ALA's in-house three-year-old brokerage program (315-736-1195, extension 102; fax 315-736-5215) that takes care of cars from four states and spends just 20 percent on administration and advertising. This program also provides the income tax forms you need.

A junker car is towed away for free, the parts salvaged, and the fluids recycled. "Half of them are fairly decent cars," says Fisher, "but for the junkers we get $50 per car after costs, no matter what."

Donations aren't limited to cars, says Fisher, but some simply aren't accepted. "One gentleman wanted to donate a mummy's hand to an affiliate in New York State. Another tried to get rid of terrible property in Detroit."

Top Of Page
National Kidney Foundation NY/NJ

National Kidney Foundation, Kara Callahan, 30 East 33rd Street, New York 10016. 800-488-cars or 212-889-2210; fax 212-779-8056. http://www.kidney.org. Donations improve care and treatment of those with kidney, urologic, and hypertensive diseases -- with research, patient and community services, professional education, and public education.

NKF New York/New Jersey. For Middlesex or Somerset Counties, call 800-63-DONATE or 212-629-9770; fax 212-629-5652.

NKF Greater Delaware Valley, Karen McGrath, community director, 325 Chestnut Street, Suite 1016, Philadelphia 19106. 800-488-cars. For Mercer County, call Prudence Vipiani 215-923-8611.

Mercer County cars go to the Delaware Valley branch of the kidney charity, while the New York/New Jersey branch of the kidney charity picks up in Middlesex or Somerset county.

Karen McGrath says the Delaware Valley chapter sold more than 800 cars last year and made more than $200,000 profit. Nationally, the foundation recovered more than 44,000 cars, grossed $9.1 million and made a net profit of $6.5 million.

"Obviously we make more money on later model vehicles that are sold rather than salvaged," says McGrath. "The people who do that are in a bracket where the tax deduction means something to them." Many are from the Mercer, Burlington, and Bucks counties.

"We take any type of vehicle -- airplanes, farm equipment, tractors, trucks, boats. A little town bought a garbage truck we were happy to take the old garbage truck off their hands. For other types of property we refer them to Goodwill or to a thrift shop," says McGrath.

Like most of the charities, the Kidney Foundation works through the Auto Placement Center brokerage, which does all of the administrative work. "Part of our mission is increasing organ donor awareness and promoting support groups and mentor programs," says McGrath.

The Foundation is careful to funnel funds to the locations from which it receives cars. Robert Wood Johnson, for instance, is one of the hospitals benefiting from kidney foundation funds. "You can call and get pamphlets on the myriad of kidney diseases, referrals to doctors, and educational programs for health care workers, but the majority of money goes to research grants and care for indigent patients," says Kara Callahan of the national group.

Top Of Page
Other Recipients

American Cancer Society. The program for both the Mercer chapter on Princeton Pike and the Middlesex County chapter on Route 1 North in North Brunswick is run from an office at 507 Westminster Avenue, Box 815, Elizabeth 07207. 800-318-6661.

Big Brothers/Big Sisters of Mercer County, 310 Rowan Avenue, 609-888-2227. Peter Weaver, executive director. The Cars for Kids' Sake program (800-859-6526) accepts cars, trucks, or boats, regardless of condition http://www.bbs.org/car.html.

Salvation Army, 436 Mulberry Street, Trenton 08638. 888-999-ARMY or 2769. http://www.salvationarmy.org. Donations support drug and alcohol rehab programs in the northeast region, including Trenton's, says Paul Kelly, finance director at the regional office in Nyack.

The average car sells for $275, and the Salvation Army nets a high percentage, 70 to 75 percent, which it uses for capital purposes.

Top Of Page
How to Do It

Look for the right charity. The World Wide Web is not necessarily a good place to search. One search engine produced mostly references to brokers such as Charity Donation Programs of Rancho Cordova in California that raises funds for children's homes. Its website (http://www.donateacar.com has a link to help you determine the "Full Fair Market Value" of your car. Yet the Chronicle of Philanthropy reported on March 26 that California Senator Patrick Johnston has attacked this program for turning over less than 10 percent of the profits to the recipient homes. In contrast the Salvation Army program keeps up to 66 percent of the gross.

If your car is in good enough condition for someone to drive it, consider turning it over to the United Way, which will assign the car to a charity that needs it to carry out its programs.

Ask questions. The charity must be certified as a 501 (c3) tax-exempt organization -- or a religious organization. How much money will it receive from the donations? This is not a well-regulated area. The amount varies from 10 percent to 72 percent. Where will the proceeds go? One place to check is with the Department of Consumer Affairs' charities' registration hotline at 973-504-6215.

Fill out the right forms Any gift of property worth more than $500 must be listed on IRS Form 8283, attached to your federal tax return. Any car worth more than $5,000 must have an independent appraisal (cost, about $75). Ask for IRS publication 526 and 561 on charitable contributions and determine the fair market value of donated property. Consult with an accountant if you have income over $100,000. Calls 800-829-3676 or go to http://www.irs.ustreas.gov.

Top Of Page
A Dealer's Deal

The Princeton YWCA has its own system for car donations. "We have an arrangement with Nassau Conover Ford and they do all the middle person work," says John Jorgensen, executive director. The Y gets a couple of cars donated every year, and they may not be perfect but they are drivable.

Stahl, of Princeton Nassau Conover Ford Lincoln Mercury, appraises cars donated to the Princeton Family YMCA, one of the charities for which he serves on the board. An accounting and economics major at Susquehanna University, Class of 1981, he has been at the car dealership on State Road for nearly five years.

"The IRS has learned to question what someone is putting down in value," says Stahl. "Many of the cars donated do not have their value listed in books, and no car matches the guidebook exactly, because the guidebook does not add options like the CD player or how often you changed the oil. When I tell you what the retail value is, it is likely to be more accurate."

Stahl treats the donation like a trade in and often sells it to a wholesaler. "Nassau Conover sends us a check and we send the donor a statement with the amount," says Jorgensen.

"Most people are donating junk cars," says Stahl. "Very rarely is anyone donating anything over $3,000 to $4,000. Someone who is giving a $15,000 car isn't doing it because of tax consequences but because they love the charity." Owners of late model cars would save by trading them in and slashing their sales tax than by using them as a donation. "Unless the charity has a use for it, the charity is probably better off with cash," says Stahl. And, he adds, "The person disposing of the vehicle isn't making any money."

-- Barbara Fox


Next Story


Corrections or additions?


This page is published by PrincetonInfo.com -- the web site for U.S. 1 Newspaper in Princeton, New Jersey.

Facebook Comments