« Muslims say their employer hasn't made room for prayer. | Main | capitol gridlock ties up transportation »
July 15, 2005
Charities see drop in donated cars
On July 8, 2005 there was an article posted on MPR website entitled “Charities See Drop in Donated Cars.” In the past people who decided to donate, their cars to charity were allowed to take the value of the car as a tax write off. The problem with this arrangement is that in the past people were allowed to value there cars as “far market value.” Unfortunately, some people took advantage of this situation and valued their cars for more than they could have sold them. As a result, congress changed the law so that now people only get what the charity sells the car for as a tax write off. This ruling has caused a decline in the amount of cars that have been donated. Some charities like Courage Center which, in the past have made $2 million a year from car donations has seen a 50% drop in earnings.
The unfortunate thing with this story is that one would think that people would be making the donations out of the kindness in their hearts but really the only reason most people do it is for the tax write off. I don’t really see a simple solution to the problem thought. If people are over pricing their cars and ripping off the government that is bad but it is also bad that these charities are not making the money that they used to.