Car donation for tax write-off?
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Car donation for tax write-off? - 7/14/2008 3:47:55 PM
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ronaldo
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I''m an independent contractor in need of some tax write-offs. It was suggested to me by an accountant that I purchase a car for a few hundred dollars, and then sometime during the year, donate it to a specific charity (a local church) that offers a minimum $1,000 tax write-off for car donations.
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RE: Car donation for tax write-off? - 7/15/2008 3:53:51 PM
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mikedevidh
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I''m an independent contractor in need of some tax write-offs. It was suggested to me by an accountant that I purchase a car for a few hundred dollars, and then sometime during the year, donate it to a specific charity (a local church) that offers a minimum $1,000 tax write-off for car donations.
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RE: Car donation for tax write-off? - 8/26/2008 1:49:04 PM
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mikedevidh
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In order to raise money for charity from your generous auto donation, the charity cars need to be sold. We sell many vehicles at retail locations.
donate a car to charity - together everyone achieves more!
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RE: Car donation for tax write-off? - 8/27/2008 12:04:48 PM
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mikedevidh
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Even if, by some miracle, you could deduct $1000 for that car that you just bought for $500, you would still lose money on the deal. Why? Because a tax deduction is not "deducted" from the amount of tax that you owe (that is what a "tax credit" is). Rather, a deduction is deducted from your income, before the amount of tax is calculated. The actual cash value to you of a deduction is the deduction multiplied by your tax bracket. For example, let''s say that you are in the 25% tax bracket (for a single person, that would mean taxable income after all of your deductions and exemptions between $31,851 and $77,100; for a married couple filing jointly, taxable income between $63,701 and $128,500). A $1000 deduction only lowers your federal tax bill by $250. So you would wind up $250 in the hole after paying $500 for the car. Even if you are in a state with a high state income tax rate of 10%, you would still be in the whole $150. Your combined federal and state tax rate would have to exceed 50% for your example to save you any money at all, which is pretty much impossible since the top federal rate is 35% (for income exceeding $349,701), and I don''t think any state''s top rate is 15%.
donate a car to charity - together everyone achieves more
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