BEWARE
OF VEHICLE DONATION PROGRAMS OFFERING MORE THAN FAIR MARKET
VALUE
While
the IRS allows consumers to use vehicle values guides to asses
the Fair Market Value of a donated vehicle, Kelley Blue Book has
important information for donors this holiday season.
Charities
that tell donors that they can claim the full Kelley Blue Book
'Suggested Retail' value for their tax purposes are leading consumers
down the path to a possible audit. The Kelley Blue Book "Suggested
Retail' value is NOT an appropriate value for donations. Kelley
Blue Book recommends using the 'Private Party Value' instead of
the 'Used Retail' or 'Trade In' values for vehicle donations.
Private Party values are free to consumers on the company's Web
site, www.kbb.com.
Today,
Kelley Blue Book offers the IRS-accepted Fair Market Value only
on its Web site through the Kelley Blue Book VEHICLE CONDITION
QUIZ. To accurately assess a vehicle's Fair Market Value, you
must use this quiz, which takes the vehicle's engine, options
and condition into consideration before assigning a final value
to the donated vehicle.
"Every
used car is different. It's important to accurately assign the
most appropriate value to your specific donated vehicle,"
said Charlie Vogelheim, executive editor of the Kelley Blue Book.
The
Vehicle Condition Quiz can be found online on every 'Private Party'
used car pricing report. First select 'Private Party' Value from
the home page. Next, include the correct mileage, engine and options,
click on the Rate It button to assign the most accurate Fair Market
Value.
"We
recommend donors use the Kelley Blue Book Vehicle Condition Quiz
as it is the most comprehensive way to evaluate the condition
of a donated vehicle," said Joe Hearn, vice president of
ADESA Impact, which cooperates with many top vehicle charity programs.
"Nearly 60% of donated vehicles are in fair or poor condition,
requiring a more accurate portrayal of its condition at the time
of donation for tax purposes."
A
print out of the Vehicle Condition Quiz and photos of the vehicle
can serve as documentation to show credible evidence of a vehicle's
condition at the time of appraisal and in your itemized tax deductions.
(Vehicles valued at $5,000 or more must be appraised by a certified
vehicle appraiser. To assure accuracy in all cases, consult your
tax advisor.)
TOP LINE FACTS
1. Charities that state donors can claim the full Kelley Blue
Book 'Suggested Retail' value on their taxes are leading consumers
toward a possible audit. It is the 'Private Party' value that
represents a Fair Market Value.
2.
Today, Kelley Blue Book offers the IRS-accepted Fair Market Value
only on its Web site www.kbb.com
through its VEHICLE CONDITION QUIZ. This is a free service to
all consumers.
3.
Kelley Blue Book recommends using the 'Private Party Value' instead
of the 'Suggested Retail' or 'Trade In' values for vehicle donations.
These three values are different and represent different transactions.
4.
The vehicle's current condition must be taken into consideration
when assigning a value, this includes; the correct mileage, engine,
optional equipment and condition.
For more information on vehicle donation, visit the www.kbb.com Tools, Tips & Advice section.
(Source: Kelley
Blue Book)
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