Dear National Kidney Foundation of Utah & Idaho,
Thank you for your help with the debt I owed to Les Schwab Tire Center for fixing my car. I have to travel approximately 60 miles to dialysis 4 days a week for my dialysis treatments. The gas and car maintenance expenses have been very hard on me. I have been struggling to keep current with my bills since I started dialysis. I appreciate your help so very much. Every little bit helps. The Kidney Foundation of Utah is so wonderful to help those of us with kidney failure in such dire need. Thank you for your assistance. Once again, God bless you and thank you!
Dear National Kidney Foundation of Utah & Idaho,
My son Derek passed away July 1, 2016. He was born with no kidney in 1995. Right after Derek was born he was life-flighted to Primary Children’s Hospital. Our journey of hospital stays, surgeries, tests, and constant poking started the day he was born. I gave Derek my kidney when he was 6, in 2001. Through the Foundation, my costs were paid to donate my kidney to Derek. Unfortunately, he lost that kidney to BK Virus and renal cell carcinoma in 2004. We waited nearly 5 years for another kidney. During that time, he required dialysis. As we live on the Utah/Wyoming border. Because there are no pediatric dialysis centers there, I was trained to be a dialysis tech. We did home hemo dialysis. In 2009 Derek received a kidney from a man that died in an accident. That kidney was a wonderful gift that gave Derek a normal life till his recent passing from leukemia. During those years The National Kidney Foundation of Utah & Idaho, through different programs, gave Derek a somewhat normal childhood. He loved Lagoon Day, going to Youth Transplant Kamp at Camp Kostopoulis, and going to IT school because of a Kidney Patient Scholarship provided by the Foundation. As the National Kidney Foundation of Utah does so much for families like ours, I wanted to give back somehow. When Derek passed away, I set up a memorial fund in his name for pediatric kidney patients. In all, $850 was donated in Derek’s name. If possible, I would like this money to be used to help another child have a “Normal” life. Whether it be for camp scholarships, Lagoon Day, expenses of a family in need with a child who has kidney failure. God bless. Thank you. Kali B.
It’s easy to donate a car to charity if all you want to do is get rid of it. Simply call a charity that accepts old vehicles, and it will tow your heap away.
If you want to maximize the benefits for both the charity and yourself, however, it’s more complicated. Until 2005, it was easy for taxpayers to deduct the entire “fair market value” of a donated vehicle from their taxable income, reducing the taxes they’d have to pay to the Internal Revenue Service. (The IRS defines fair market value as “the price a willing buyer would pay and a willing seller would accept for the vehicle, when neither party is compelled to buy or sell and both parties have reasonable knowledge of the relevant facts.”)
Allowing taxpayers to deduct the full fair market value for all those donated vehicles cost the IRS a lot of dollars, however, so the agency tightened the rules. Today, you can only deduct a vehicle’s fair market value under very specific conditions. We’re going to walk you through those conditions, with the usual proviso that you should discuss these issues with your tax preparer before you act. Also note that if your state or locality also levies income taxes, other rules may also apply.
You Must Itemize Your Return
If you want to claim fair market value for your car donation to reduce your federal income taxes, you must itemize deductions, says Twila D. Midwood, an enrolled agent based in Rockledge, Florida. An enrolled agent is a tax expert who can represent clients before the IRS.
If you’ve always filed 1040EZ tax returns and you plan to keep filing them, you won’t be able to deduct any amount for the car donation. You can file a regular 1040 tax form and itemize, even if the donated auto is your only deduction. That’s usually not the best choice, however, unless you like paying a lot more taxes to the IRS than you must.
“For tax purposes, because a donation is a deduction from your income, the tax benefit relates to your tax bracket,” Midwood says. “It’s not a dollar-for-dollar item.”
Here’s the math: Suppose you are in the 28 percent tax bracket. Your donated car’s value, and thus the deduction, is $1,000. “The $1,000 deduction will save you $280,” Midwood says. If you’re in the 15 percent tax bracket and you donate a car worth $1,000, it will only reduce your taxes by $150.
If instead you take the standard deduction, which in 2012 was $5,950 for a single individual or $11,900 for a married couple filing together, you save thousands of dollars over filing an itemized return only for the purposes of detailing your car donation.
The only way that donating a car nets you any tax benefit is if you have many deductions, and if their total sum, including the car, exceeds your standard deduction.
The Charity Must Qualify
Your city councilman’s campaign organization and your hobby club may be nonprofit organizations, but donating a car to them won’t give you any tax benefits. Only “qualified” charities can provide those for you. A qualified charity is one that has been approved by the IRS as an “exempt-status” or 501(c)(3) organization, Midwood says. Most organizations will state in their advertising or receipts that they’re a 501(c)(3) if indeed they are one, she says. “If you’re not sure, ask.”
Religious organizations are a special case. They do count as qualified organizations, but they aren’t required to file for 501(c)(3) status.
To help you determine whether a charity is qualified, the easiest thing to do is visit the IRS’s exempt organizations site.
You also can call an IRS toll-free number: (877) 829-5500. If you do this, you’ll have to listen to some recorded information about tax forms that probably don’t apply to you. You’ll then be given the option to “Press 2” to talk to a customer service rep about exempt organizations. Note that the waits can be quite long: up to 30 minutes.
You can always donate as much as you want to charities, but the IRS limits how much you can claim on your tax return. “Charitable donations can’t exceed 50 percent of your gross income,” Midwood says.
How To Deduct Fair Market Value
These are the four IRS rules under which you can get the maximum deduction (the fair market value) of a donated car:
1. When a charity auctions your car for $500 or less, you can claim either the fair market value or $500, whichever is less.
2. When the charity intends to make a “significant intervening use of the vehicle.” This means the charity will use the car in its work, such as delivering meals to needy people.
3. When the charity intends to make a “material improvement” to the vehicle, which is “anything that increases the car’s value and prolongs its life,” Midwood says. “It can’t be a minor repair or maintenance; it must be something like fixing the engine or systems that run the car,” she says.
4. When the charity gives or sells the vehicle to a needy individual at a price significantly below fair market value, and the gift or sale is part of the charity’s mission of helping the needy who need transportation.
How To Determine Fair Market Value
To recap, the IRS defines fair market value as the price a willing buyer would pay and a willing seller would accept for the vehicle, when neither party is compelled to buy or sell and both parties have reasonable knowledge of the relevant facts. Neither the buyer nor the seller can be an auto dealer. Both must be private parties.
Edmunds.com makes it easy to determine your vehicle’s fair market value. And, as Midwood says, your assessment has to be “an apples-to-apples comparison.”
IRS Publication 4303 explains this in more detail: “If you use a vehicle pricing guide to determine fair market value, be sure that the sales price listed is for a vehicle that is the same make, model and year, sold in the same condition, and with the same or substantially similar options or accessories as your vehicle.”
Here’s an example: Let’s say your car is a 2003 Honda Accord DX sedan (the lowest trim level). It has 200,000 miles and it’s in “average” condition. Edmunds estimates it would be worth $1,862 in a private-party sale in Southern California. You can’t instead claim the $5,318 private-party value of a Honda Accord EX sedan (a much higher trim level) with 100,000 miles in “clean condition” (a condition grade that’s one step up from “average”).
Getting Fair Market Value Is Rare
It’s not realistic to expect that your car will meet one of the most stringent fair market value requirements. Take it from 1-800-Charity Cars, which says it is the largest car donation charity in the United States. It picks up donated vehicles from across the country and gives as many of the cars as possible to people who need transportation. According to the charity, few donated cars are suitable to give to the people it serves.
“If 5 percent go to our clients, I’m thrilled,” says CEO Brian Menzies. “Although we take any car, about one-third go straight to salvage, i.e., junk.” The rest are auctioned and the proceeds go to the charity of the donor’s choice, he says.
The point that Menzies is making is this: Unless your car is in good or excellent condition, it will most likely be sold at auction or to an auto salvage yard. In that case, your deduction is based on the car’s selling price, not your fair market value estimate.
Note that this price is not something you’ll know when you donate the vehicle. “An organization has up to three years to sell the vehicle,” Midwood says. “If they sell the vehicle within three years, they must notify the IRS and the donor.”
If the April tax deadline is approaching and the charity still hasn’t sent you a notification of your vehicle’s sale, such as an acknowledgement, receipt or form 1098-C, you have two options.
Paperwork Is Important
According to IRS Publication 526, the first option is to file Form 4868 to request an automatic six-month extension of time to submit your return. Your second option is to file the return on time without claiming the deduction for the qualified vehicle. When the charity finally sends your notification, you can file an amended return using form 1040X to claim the deduction. You’ll have to attach a copy of the notification to your 1040X.
Getting tax benefits for a donated car requires a lot of documentation, whether the car is junked, sold at auction or given to a charity’s client. IRS Publication 4303 has all the details. One tip: Keep all the papers or electronic files. You’ll need them at tax time.
Another Approach to Car “Donation”
Besides giving your car directly to a charity, there is another way your vehicle can help a charity and also maximize your tax benefits: You can sell the vehicle yourself and donate the proceeds.
“If the qualified organization is going to sell the vehicle in order to receive cash, then it would make sense for an individual to sell the vehicle to a private party to maximize the amount of cash proceeds,” Midwood says.
“Privately selling the vehicle might generate larger cash proceeds than if the organization were to sell the vehicle, she says. “The donor would then make a cash contribution to the organization.”
Selling any car can be a hassle and selling one that’s on its last legs poses challenges of its own. How you proceed depends on your goal. Are you focused on getting rid of a junker with minimum effort and you’d look at the tax deduction as a nice bonus? Then donating your car makes good sense.
If your goal is to maximize your tax deduction, carefully review the steps here and then make your decision. Whatever you decide to do, parting with your old car could help a nonprofit carry out its mission. And it also might make room in your garage for a new car.
A letter left for us in a Kidney Kar donation today:
Dear NKF of Utah,
I am donating “Ruby” in honor of my father who endured so much dialysis and hoped for a new kidney but eventually succumbed to renal failure. Please make good use of her and help as many people as you can. Thank you for the opportunity to be able to give this away.
Love and Hope, Cristina and Josie.
Ready for your Monday Cry? This is a dad with heart.
PITTSBURGH — “It has been the best day of my life,” a Pennsylvania bride said of her wedding day.
Jeni Stepien is now officially a married woman, and she told CBS Pittsburgh the day wouldn’t have been possible without Arthur Thomas.
“You can never imagine what that would be like unless you actually do it because so many emotions involved in what you’re doing,” Thomas said.
Arthur, fondly known as ‘Tom,’ traveled from New Jersey to walk Jeni down the aisle at St. Anselm church in Swissvale, since her father couldn’t be there.
Jeni met Tom for the first time on the eve of her wedding, when she felt her father’s heart beat for the first time in 10 years. Michael Stepien was murdered in Swissvale back in 2006.
Tom received Michael’s heart after his death.
“I was on death’s door when he was murdered and I needed a heart or I was going to be dying in the next few days,” Thomas said.
Jeni asked Tom if he would do the honors in a letter.
“I was just so thankful that my dad could be here with us today in spirit and a piece of his physical being as well. That was really special for us,” she said.
Jeni’s groom was also moved by the gesture.
“I was just overtaken with emotions when I finally saw her walking down. The most beautiful woman in the world that I’ve ever seen before,” Paul Maenner said.
“What a greater honor could a person have than walking the daughter of the man who’s given his heart to him. I can’t imagine a greater honor,” Thomas said.
‘Success Kid’ helps fund dad’s kidney transplant
Posted: Aug 19, 2015 7:19 AM MDTUpdated: Aug 19, 2015 11:23 AM MDT
Thank you for your continued support and participation of the Ogden Surgical Medical Society Conference. The National Kidney Foundation of Utah & Idaho lectures by Harry O. Senekjian, MD, Kalani Raphael, MD, and Monique E. Cho, MD, improved the performance and competence of 451 attendees: 161 active MDs & DOs ; 95 retired MDs; 52 PAs & NPs; 55 Nurses, Paramedics & Social Workers; 15 Residents, 9 Doctors of Nurse Practitioner Students and 14 Pre-Med students, as well as 35 guests, which included the Hill Air Force Base Medical Providers.
I will send the Power Point presentation to your board for the upcoming Annual Meeting. Thanks again and thank you for improving the medical providers of Utah’s performance and competence in nephrology. Every year we aim to update health providers on new information medically related and the National Kidney Foundation of Utah & Idaho excels!
A Wausau woman is the last link in a 68-person kidney transplant chain of donations that started in Minnesota, spread across the country and ended at the University of Wisconsin in late March.
After living with renal insufficiency for 30 years, 77-year-old Mitzi Neyens’ condition had begun to worsen in the past two years, she told Press-Gazette Media. She was able to take part in the massive organ donation chain after De Pere school teacher Megan O’Leary donated a kidney to a matched recipient in exchange for a matched kidney for Neyens, her long-time family friend.
“I was more anxious to get disqualified and not be able to donate,” O’Leary said about the donation process. “Most people say it seems like it would be hard, but to me it wasn’t, it just kind of felt like the right thing to do. I wasn’t nervous about it at all.”
The chain began in Minnesota with a woman who wanted to donate a kidney to no one in particular. Thus began the process of coordinating 34 kidney exchanges.
“It’s unheard of,” said Karen Miller, the paired kidney exchange coordinator for the University of Wisconsin transplant program. “It’s very, very difficult. So many things can happen during that process: a donor gets sick; a donor backs out; a recipient gets sick; somebody dies.”
The National Kidney Registry, which uses a computer to link organ donation chains, and 26 hospitals nationwide helped coordinate the kidney exchanges involving 68 people.
“It’s always amazing when transplants occur,” Miller said. “Was I surprised? No. As you get into paired kidney exchange I always hope for the very best and want every paired kidney exchange, every match, to proceed. That’s honestly unrealistic, that’s never going to happen.”
More than 2,500 Wisconsin residents are among the estimated 123,000 Americans in need of an organ transplant.
About 2.6 million people are registered donors in Wisconsin, and about 2 million more are eligible, according to advocates.
March 26, 2015
In 2003 Yu Young was a bright eyed, sweet tempered and darling high school Junior when she came to the National Kidney Foundation of Utah & Idaho’s Provo office as an intern. For two years, after school, she answered the phone taking Kidney Cars donations, made photocopies and filed. She did everything for everyone in the office. We liked her so much, we hired her as an employee once she started school at BYU. She worked her way through college on our megar non-profit hourly wage while making a substantive and meaningful addition to the staff. She was so good and helpful on the phone, she was helpful and kind in the office, and when she graduated BYU I thought my heart might stop. We had not only come to rely on her, but more, she was our friend.
Two days ago, while downloading the Kidney Kars donations, I noticed a car donated from the Young familiy in Provo that included a cheeky little note in the ‘donor comments section.’ It was from Yu. She had helped her mom and dad donate their car online at www.towKars.org I was so touched.
Yu went on to become one of first Chinese Immersion teachers in the Salt Lake City School District and is now the director of all language immersion programs.
I miss her here and I am so grateful that even though she’s gone on to much bigger things, she would, in some small and very meaningful way, remember us! Thank you Mr. & Mrs. Young for giving us Yu and for donating your car to Kidney Kars of Utah!