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Tax Question - Donated car to charity...car was originally gifted to me
Posted on 2/8/17 at 11:08 am
Posted on 2/8/17 at 11:08 am
In high school, my parents bought me a car and had it registered to me. I kept it until the year after I graduated college. My parents were looking to buy a new car and I was interested in their old car, so they traded me their old car for mine, and then traded in my car to go toward their new car purchase. I hope I haven't lost you...
I kept that same car for several years, doing several repairs to keep it running, and probably invested a few $K over at least a decade. Last year, it finally had a major breakdown that wasn't worth fixing, so I donated it to a local charity, in which it sold for $800 according to their 1098C form that they sent me. I figured that I could write this off on my taxes, but according to Turbotax, since the car "appreciated" to $800 from the $0 that I paid for it, I can't receive any tax break. Is this correct? I spent a lot of money to keep that car running. I could have also sold the car to a parts yard and donated the proceeds from it, and received a tax benefit, no? I don't understand why I can't get a benefit just because of the means to which I donated to charity.
I kept that same car for several years, doing several repairs to keep it running, and probably invested a few $K over at least a decade. Last year, it finally had a major breakdown that wasn't worth fixing, so I donated it to a local charity, in which it sold for $800 according to their 1098C form that they sent me. I figured that I could write this off on my taxes, but according to Turbotax, since the car "appreciated" to $800 from the $0 that I paid for it, I can't receive any tax break. Is this correct? I spent a lot of money to keep that car running. I could have also sold the car to a parts yard and donated the proceeds from it, and received a tax benefit, no? I don't understand why I can't get a benefit just because of the means to which I donated to charity.
This post was edited on 2/8/17 at 11:09 am
Posted on 2/8/17 at 11:42 am to Green Grass Miracle
Are you itemizing?
Posted on 2/8/17 at 11:56 am to Green Grass Miracle
I think you can deduct it for its FMV $800 on Sch A. You're going to have to fill out form 8283. Read the instructions for that form should be all you need.
Posted on 2/8/17 at 5:18 pm to Green Grass Miracle
It should be an $800 deduction.
Posted on 2/8/17 at 8:42 pm to Green Grass Miracle
Your parents can gift you $28,000 a year tax free. You get fmv basis for the gift. If it's fmv is worth more than $800 then you should be able to deduct something if you itemize. Your deduction should be $800 since your fmv should equal basis therefore no gain on the "sale".
This post was edited on 2/8/17 at 8:44 pm
Posted on 2/9/17 at 10:31 am to Mouthulcer
Thanks. Turbotax needs some improvement in this section. The FMV was easily over $800 when I got it...probably at least $8K to be honest as it was in good condition. I know I've invested at least $1K into it, so I just put $1k as the purchase price in turbotax, and it gave me the full deduction, which added about $200 to my refund.
Thanks for the advice everyone!
Thanks for the advice everyone!
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