Since the tax law changes of 2004 took effect, the administrative burden of processing vehicle donations has become almost unbearable. Do you know if you are meeting the Federal Government's requirements?
We will send Thank You Letters to your donors on your behalf. As soon as the sale of a donated vehicle is completed, we will send a Thank You Letter (on your company letterhead) to the donor acknowledging their donation. We will bear the expense of ensuring that your donors receive timely acknowledgments of their gifts.
If a donated vehicle sells for over $500, we will also send IRS Form 1098-C along with the Thank You Letter. You must furnish Form 1098-C to the donor within 30 days of the gift, or within 30 days after the sale of the donated vehicle.
If the IRS finds that your organization knowingly furnished a false or fraudulent acknowledgment, or knowingly failed to furnish the acknowledgment as required by the rules, you can be fined. The penalty is based upon the value of the vehicle, and there is a formula that applies.
If you have any questions regarding the tax documentation process, please give us a call and we will give you a free no-strings-attached process review. The key to helping your donors maximize their tax deduction starts with preparing their paperwork correctly. We offer a Turn Key Program which will eliminate this burden all together.
For more information on the new tax laws please check our IRS Tax Law Section.