Donating your car to charity is a great way to get rid of your old car while helping fund the programs offered by your favorite nonprofit organization. Most charities don’t handle the vehicle donation process themselves, which costs money and requires a lot of manpower. Instead, they typically contract with a commercial or nonprofit fundraising organization, which handles all of the details, takes a cut of the proceeds, and sends the rest along to the charity.
Unfortunately, the car donation industry is crawling with vermin who will be happy to take the vehicle off your hands under the guise of donating a percentage of the proceeds from its sale, but too often, that percentage is often as low as 13 percent.
To ensure the charity of your choice gets a fair percentage of the proceeds, it’s essential to donate through a highly reputable intermediary that will forward 75 percent or more of the net proceeds to the charity you choose. An intermediary that passes along 60 to 74 percent of the net proceeds is considered more or less satisfactory, but anything less than 60 percent is unacceptable.
Additionally, it’s a good idea to donate only to charities that are considered “highly efficient,” which means that at least 75 percent of their expenses go directly toward their programs to further their stated mission.
With these factors in mind, here are my top seven choices for the best car donation programs, listed in no particular order.
1. One Car, One Difference
One Car, One Difference is a public awareness campaign run by the Insurance Auto Auctions Donation Division, which handles all aspects of the donation process through the One Car, One Difference website or their online tool, Auto-Donation.com.
Charities who contract with IAA’s Donation Division, including the Boy Scouts of America and the American Red Cross, typically see around 72 percent of the gross proceeds from the sale of a vehicle, which is about as good as it gets.
2. Charity Motors
Charity Motors is a highly efficient charity that accepts vehicle donations, which they turn around and sell to individuals in need for 50 percent of the fair market value, and they donate a high percentage of the proceeds to the charity of your choice.
If you’re looking for the highest tax deduction, donate your vehicle to Charity Motors to take a deduction that’s worth the fair market value of the car, regardless of the sale price, since they sell the cars at a discount to people in need. If the vehicle is sold at auction with a portion of the proceeds going to charity, you can only take a deduction equal to the actual sale price of the car.
3. Car Donation Wizard
Car Donation Wizard is the car donation tool provided by commercial fundraising organization Advanced Remarketing Services, which consistently passes on over 80 percent of the proceeds to the charities that contract with them, including Habitat for Humanity.
Advanced Remarketing Services is a nationally licensed and highly reputable vehicle dealer, which enables them to save on the costs associated with processing a donation.
4. The Arc Vehicle Donation
The Arc is a nonprofit organization that advocates for and serves people with intellectual and developmental disabilities. To handle the car donation process, this highly efficient charity contracts with another highly efficient charity, Melwood, whose Charity Car Donation Center employs people with intellectual and developmental disabilities. You can support two causes with one car by donating to The Arc through Melwood!
5. AllState Car Donations
Allstate Car Donations isn’t affiliated with the insurance company by the same name. Rather, this organization is the fundraising arm of the Center for Living & Learning, based in Van Nuys, California, which provides paid vocational apprenticeships to recover addicts, ex-offenders, and at-risk populations. The apprentices process the car donations, which pay their salaries and fund other Center programs that teach work ethics, appropriate workplace behaviors, and effective communication skills.
6. Riteway Charity Services
Another highly reputable commercial fundraising organization, Riteway Charity Services typically passes on between 75 and 100 percent of the net proceeds from car donations to the charities that contract with them, which includes Children’s Hospital of Los Angeles, a highly efficient nonprofit and world-renowned hospital.
However, some charities get considerably less, depending on the value of the vehicles, although in the majority of cases, it’s above 60 percent. Still, it’s a good idea to double-check with the charity of your choice to ensure they get a high return before settling on donating through Riteway Charity Services.
7. V-DAC (Vehicle Donations to Any Charity)
V-DAC is a commercial fundraising organization that always passes on between 70 and 75 percent of the net proceeds from donated vehicles to the charities that contract with them. Unlike most commercial and charitable intermediaries, V-DAC provides consumers and charities with their fee schedule to help take the guesswork out of determining how much a charity will get, based on the sale price of the car.
V-DAC, with the help of Advanced Remarketing Services, is the driving force behind the Car Talk Vehicle Donation Program, which earned five stars in my recent review of them.
Working with Legitimate Car Donation Programs
The list provided above is just our recommendations. If you’ve done a little research, you’ll find that there are more than 965,000 car donation programs in the US today.
With these numbers, federal and local government agencies will find it difficult to verify the legitimacy of all these organizations. So if you’d like to consider other options, make sure that you don’t get caught up in a scam.
To make sure that you’re working with a legitimate organization when donating a vehicle, it’s always best to visit the IRS website. They have a list of all charities with 501 (c) (3) status that have registered with the IRS.
However, if in case your charity is not on the list, you can also check with your state attorney general’s office if the charity is legitimate.
As much as possible, try to avoid working with a middleman, especially those that do not have a direct affiliation to the charity that you support. This is because most middlemen take much more than the actual funds that can go to your charity after your vehicle is sold, so your chosen charity may end up not benefiting from your donation at all.
If it’s inevitable, try to look for one that donates more than what they get. It’s a good idea to ask for the opinion of your chosen charity as they can recommend those that they have already worked with previously.