Tax Season Reminder: Vehicle Donations Still Needed

Charitable Contributions Decline Even Though Everyone Benefits

And Don't Forget to Claim The Deduction!

Apr 10, 2008, 01:00 ET from National Kidney Foundation

    NEW YORK, April 10 /PRNewswire/ -- A new government report, published
 just in time for tax season, is a timely reminder that donating your car is
 still a great way to contribute to a local charity. But fewer people seem
 to know that because the number of vehicle donations has plummeted -- and
 charities are feeling the pain.
     In 2004, the Congress changed the rules governing vehicle donations.
 Since then, car and truck donations have decreased by 39 percent, according
 to the new report by the US Government Accountability Office (GAO). The GAO
 also reported that, during 2005 and 2006, revenues from vehicles donated to
 the surveyed charities dropped by 25 percent.
     The changes were intended to address tax abuses and enforcement
 shortcomings. During congressional debate, proponents argued that the
 changes would not adversely affect charitable contributions.
     But the report documents that charities have had to curtail homeless
 and public health services, a microcosm of the cutbacks in service to the
 sick and needy by hundreds of charities across the country. From 2004 to
 2006, for example, the volume of donations to the National Kidney
 Foundation had declined by 42,000 vehicles or 52 percent. The resulting
 revenue decreased by $8 million or 44 percent. The Kidney Foundation, based
 in New York, has worked since to diversify its fundraising base but smaller
 charities have found it particularly difficult to compensate for lost
 vehicle donation revenue.
     "They meant well but these changes went overboard, and it's cancer
 victims who are paying the price," said James T. Reynolds Jr.,
 vice-president of Tennessee-based Cancer Fund of America. Like many
 charities -- from Massachusetts Meals on Wheels to the California Council
 of the Blind -- Reynolds expressed hope that the new government report will
 prompt a fresh congressional review.
     Meantime, as the April 15 tax deadline approaches, charities are urging
 donors to take full advantage of the existing tax incentives. "Believe it
 or not, many Americans who donate vehicles fail to claim the benefits they
 deserve," Reynolds said.
     Beginning in 2005, taxpayers could deduct only the sales price of the
 donated vehicle when sold by the charity or commercial auction for over
 $500. Previously, taxpayers could claim the estimated fair market value for
 any donated vehicle. Charities cite the uncertainty about the timing and
 amount of the final sale as reasons for public confusion about the rule
     The GAO study documented overall decreases in vehicle donations of 15
 percent in 2005 and another 28 percent in 2006. The study also showed
 declines in resulting charitable revenues of nine percent in 2005 and an
 additional 17 percent in 2006.
     For more detail or leads on affected charities in your community,
 please call:
Chad Iseman, National Kidney Foundation ( - 816-221-9559 x110 James Reynolds Jr., Cancer Fund of America ( - 480-659-9507 Charles Sisson, Massachusetts Meals on Wheels ( - 508-999-6400 x127 Jeff Thom, California Council of the Blind ( - 916-995-3967

SOURCE National Kidney Foundation