Ernie Klein <eckleinspammenot[at]pacbell.net> writes:

- quote -

Looks to me like this is using the vehicle in the charity's
activity, which means the deduction would be the same as
today. The change applies to cars that are given to the
charity and immediately sold by the charity.

Phil Marti
Clarksburg, MD

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- quote -

Actually, I am thinking of the general rules for the
donation of property that cannot be used by a charity in
performing their charitable function - i.e. "unrelated use."
[Yes, that does appear to be in the appreciated property
TR.]

Remember that the car in question could be 30+ years old and
therefore worth more now than when it was first
purchased.... [Especially for first-year models of cars
before 1970.] Blue book or insurance value may have no
relation to what a car collector may value it at. :-)

[I am in southern California where we don't have salt or
sand put down on snowy streets that tend to wreck cars from
other regions of the country.... Consider the donation of a
"1960's muscle car...." (Why anyone would is a separate
issue!)]

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DORFMONT[at]aol.com (Linda Dorfmont) wrote:

- quote -

Along the same line -- I have donated two vehicles in the
past to a charity that places the donated cars to needy
families with no intent of making a profit on the deal,
after-all - isn't that what charity is all about - giving
money or something of value to those who are needy and can't
pay 'market value' themselves? This is different from
charities that wholesale resell donated vehicles as a method
to raise cash. Since no money ever changes hands but the
donation obviously has value, under the new rules, what
value would be used?

--
-Ernie-

"There are only two kinds of computer users -- those who have
suffered a catastrophic hard drive failure, and those who will."
Have you done your backup today?

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- quote -

Are you thinking of the rules for appreciated property?

--
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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inda Dorfmont wrote:

- quote -

No deduction will be allowed without a written
acknowledgement from the charity. See Sec. 884 of the tax
act.

- quote -

You are supposed to be using the FMV value of the vehicle,
not the KBB wholesale value. KBB may be too high, too low
or correct. FMV considers the condition of the vehicle.
The KBB wholesale value does not consider the actual
condition of the vehicle.

--
Alan
http://taxtopics.net

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- quote -

.....Well, if that auction occurs within 2 years of the gift,
I don't see a change.... :-)

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Milt Baker wrote:
- quote -

Now that's a step in the right direction!

But just wait till we see the draft 8283 for year 2005! (heh heh!)

ChEAr$,
Harlan Lunsford, EA n LA
Sat, 23 Oct 2004 21:31:38

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Will the charitable recipient of the donation then give a
statement of the selling price of the vehicle to the donor?
Usually the donor forgets about the vehicle after donation
and has no further contact with the charity.

I have been using the Kelley Blue Book wholesale value of
the vehicle for FMV since the car is being transferred to
someonw who will sell it again. I attach the receipt for the
vehicle and the page out of the KBB to the tax return.

Linda Dorfmont E.A., CFP, CSA

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Harlan Lunsford <hlunsford[at]bellsouth.net> wrote:
- quote -

9-7-04 DRAFT FORM 8283 Noncash Contributions

http://www.irs.gov/pub/irs-dft/d8283.pdf

Note Change - Part I - Description Of Donated Property:

(For a donated vehicle, enter the year, make, model, and mileage)

Milt Baker CPA Michigan

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rlcarr[at]animato.arlington.ma.us says...
- quote -

The rules changed. If the vehicle is used by the charity,
then the charity is supposed to provide the taxpayer the
estimate value. If the vehicle is sold, the charitable
deduction is limited to the amount of money the charity
realized. IOW, the scams of donating a car with a blue book
value of $2,000 but in poor condition so the real value is
only $500 are in trouble. I seem to recall hearing about
companies that would run these donation programs and give
the charity a small percentage of the sales price (something
like 5% to 10%).

The scams worked like this:
A barely running car worth only $500 in real life would be
donated to the charity (actually the company running the
program). The taxpayer would deduct the $2,000 blue book
value. The car would be sold for $400 with the charity
getting say $50 and the company would keep $350.

Gary

--
You can probably X figure out X which letters to X delete to
derive my email address X.

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...or the states without an income tax were pivotal states in
the last election...

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Rich Carreiro wrote:
- quote -

Yes, effective next January 1st they will, provided our
President signs the American Jobs Creation Act of 2004,
which he will.

Do a search for the bill on the web, and note the
requirements placed on the donee to substantiate FMV.

ChEAr$,
Harlan Lunsford
Tue, 19 Oct 2004 16:34:05

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- quote -

Yes!!! The bill, taking effect Jan. 1, allows a tax
deduction to be taken only for what a car sells for at an
auction, and ONLY after it is given to a charity.

"Jack" - John H. Fisher - TaxService[at]aol.com
Philadelphia, Pa - Atlantic City, NJ - West Wildwood, NJ
My Newsgroups & Boards at: http://members.aol.com/TaxService/index.html

Where Ignorance is bliss, 'tis folly to be wise!=

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Harlan Lunsford <hlunsford[at]bellsouth.net> writes:

- quote -

What's this? Did the car donation rules change?

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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James Ries EA wrote:

- quote -

YOu think it might be a conspiracy? (grin

Same bill is one that puts the kabosh on the "SUV" tax
break, so try explaining that one to your business clients
with a lust for that big gas guzzler.

More work will be explaining why that same client can't take
a $ 6,000 deduction for the 1996 Ford Mustang he donated to
Goodwill Industries next year.

Yep, more work and NO more pay. 'tis the cross we bare.

ChEAr$,
Harlan Lunsford, EA n LA
14 oct 04 22:49:14

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- quote -

They are just wanting to make sure that we have jobs. <G
Carol
My mind not only wanders, sometimes it leaves completely.

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Quote from Tax Analysis article:
"State taxpayers would be able to choose whether to deduct
sales or income tax -- whichever is higher -- from their
federal returns under a corporate tax bill (H.R. 4520)
recently approved by Congress.

The House passed the bill on October 7 and the Senate passed
it on October 11. The bill heads next to President Bush, who
is expected to sign it."

This was widely advertised as only applying to states
without an income tax. However this is a choice. I can see
that even while practiceing in a high income tax state like
Wisconsin, I will still have to compare whether deducting
income tax or sales tax is better for each return I prepare.
I know that a number of my clients would be better claiming
the sales tax.

Congress must think we are not working hard enough.

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