Lower Your Income Tax Bill And Make Room In The Garage-zghd

Taxes Looking to lower your tax bill and get rid of Old Bessie, the car not the woman, consider making a donation. Giving a car, boat or plane to charity can save you a bundle if you qualify and do it right. Start my making sure your charity is well a charity. The most common form of a charity is a 501(c)(3). This can be any kind of group from religious to educational and anything in between. Your church, synagogue or mosque might also want your donation but might not be a 501(c)(3). You can go to the IRS website and look them up or you can call IRS Customer Service at (877) 829-5500 to find out if the people you want to contribute to are qualified charities. Just have some basic information on hand when you call or visit the website, such as the groups name and address. To qualify for a deduction on your tax return your contributions, total not just this one, must be less then 50 percent of your adjusted gross income or AGI. Your AGI is the total of all your income less certain items like money you put in an IRA or pay in student loan interest. You also have to fill out a Schedule A for itemized deductions which means you have to do the long form or 1040 not the EZ. The IRS must consider your vehicle qualified to be donated which means quoting the IRS Your donation must be of a "Qualified Vehicle" the IRS says a qualified vehicle is; "any motor vehicle manufactured primarily for use on public streets, roads, and highways; a boat; or an airplane. However, a vehicle held by you primarily for sale to customers, such as inventory of a vehicle dealer, is not a qualified vehicle." Simple enough so far. It doesn’t matter whether you are giving away and old beat up car, a boat or your plane the value matters. For example if the plane is a clunker and worth less then $500 you don’t have to do anything. If your boat floats and is worth between $500 and $5,000 then you will have to fill out and submit IRS form 8283 section A with your tax return. However, if your car is a classic and worth more then $5,000 then you will need a written appraisal from a qualified appraiser. You can check on the value of your car online at Kelly Blue Book, kbb.com or Edmunds.com. If you want to read all of the vehicle donation guidelines I suggest downloading IRS publication 4303 from the IRS website. The amount you can deduct will depend on what happens to the vehicle once it is donated. If the charity just turns your vehicle around and sells it without doing anything you can only deduct the amount the vehicle was sold for by the charity. If the charity makes improvements to your cream puff before they sell it you can take the full market value at the time of donation. Finally if the charity is going to use the vehicle for their own use before disposing of it or they donate it to another charity you can take the full market value as a deduction. As with all income tax issues always keep detailed records of what you donate, official receipts from the charity, appraisals, the date and place of the donation and a detailed description of what was donated. About the Author: 相关的主题文章: