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New 2005 car donation tax deduction laws

Taxpayers can save themselves some stress, and definately money, by starting to plan their filing before the end of the year. A popular way to get a nice tax deduction has been to donate your car to a charity.

So what changes in the tax laws should we take a look at?

The standard deduction has been increased.
For married people filing jointly, it’s now $9,700, up from $9,500.
For head of household it’s $7,150, up from $7,000.
For single or married filing separately it’s $4,850, up from $4,750.

So if you’re close to meeting your deduction, you may want to make a donation to a charity.

This change in tax laws means those generous donations won’t bring as big a break from the Internal Revenue Service (IRS) after Jan. 1.
Under current law, a taxpayer filing an itemized tax return can deduct the fair market value of an automobile given to a nonprofit.
Starting next year, if the charity resells the car, the maximum deduction will be the sale price.

Take advantage an donate your car to charity in 2004 before you miss out!

Written by in: -Tax Laws |

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