When you donate a car to a charity in California, you may be able to take a state tax deduction. To qualify, the car must be sold, and the proceeds must go to a qualified charity. You’ll need to itemize your deductions to claim a donation, and you’ll need to keep records of the donation.
If you’re planning to donate a car to charity in California, it’s important to know how the state’s tax laws apply. Here’s what you need to know.
The Basics of car donation in California
When you donate a car to charity in California, the car must be sold and the proceeds must go to a qualified charity. The charity must be registered with the state, and you’ll need to get a receipt from the charity for your records.
You can deduct the fair market value of the car from your taxes, but you can’t deduct more than the car sold for. For example, if you donate a car that’s worth $5,000 and the charity sells it for $3,000, you can deduct $3,000 from your taxes. But if the charity sells the car for $4,000, you can only deduct $4,000.
To claim a deduction for your car donation, you’ll need to itemize your deductions on your tax return. You can’t take a deduction for a car donation if you take the standard deduction.
Keep records of your car donation
When you donate a car to charity in California, be sure to get a receipt from the charity. The receipt should include the charity’s name, address, and tax identification number, as well as the date of the donation and a description of the car.
If you have any questions about car donation in California, contact the state Franchise Tax Board.