Talk Of The Region: March

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By Robert Celaschi

IRS Squeeze Closes in on
Charity Clunkers, Junkers

The rules are tougher this year for donating vehicles to charity, and charities are anxious to learn how potential donors will react.
    Under the old rules, donors could deduct full-market value for their car, truck, boat or RV. But the Internal Revenue Service suspected that too many taxpayers were claiming their clunkers were cream puffs.
    Now the donor has to get a receipt for what the vehicle actually fetched when sold by the charity. Since most are sold at public auction or to parts wholesalers, the price is usually far less than what’s listed in the Kelly Blue Book.
    A lot of money is at stake. The state attorney general’s office says vehicle donations generated $45.69 million in gross proceeds statewide in 2002, the most recent figures available. Of that total, 41.6 percent went to the charities; the fund-raisers kept the rest for expenses and fees.
    Some charities reported extra donations in December as the deadline loomed. Some people expect a big drop in 2005.
Continued...

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