3 MOST POPULAR CAR DONATION CHARITIES THAT WILL MAXIMIZE YOUR TAX DEDUCTION
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 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 recovering 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.
- Pre-Qualification: As a potential borrower before you head out to the bank, here are some of the basic requirements:
- You will be required to get a life insurance and or protection for the property you are acquiring from the bank’s preferred insurance company.
- The tenure of the property should be five to 15 years.
- Proof of identification.
- Applicants must be in the range of 18-55 years.
- Letter of intent.
- Current bank statement.
- Personal guarantee of the applicant.
However, these requirements vary from different institutions.
- Select the type of mortgage: There is a wide range of mortgages available to prospective borrowers. It can also be accessed for home acquisition, home furnishing, equity lease.
- The Interest rate: If you are borrowing in dollars, the interest rate ranges between 10 to 13.5% and 30.5% to 34.5% in cedis. However, this may vary from one financial institution to another.
- Things to look out for: According to Mr Kofi Siabi, Head of Marketing at Cal Bank, the following should be noted:
- Look at the current interest rate of the institution.
- The ability of the institution to fund the loan.
- The terms and condition of the loan. It is the part that is usually written in small wordings, which is usually ignored.
- The credibility of the institution.
AMICA: BEST OVERALL CAR INSURANCE COMPANY
Amica was the strongest company overall in my research, and ranked number two in J.D. Power’s 2015 customer satisfaction report — that means out of 11,469 surveyed drivers, it had the second highest satisfaction rating among more than 20 different companies. It also received the highest Consumer Reports rating among auto insurance providers. Consumer Reports even noted that an overwhelming number of customers reported “relatively few” problems during the claims process.
- A high J.D. Power satisfaction rating: Amica received a perfect score in 4 out of 7 categories in J.D. Power’s 2015 auto insurance study.
- High financial stability ratings: Amica boasts a “Superior” financial stability rating from A.M. Best, which is the highest rating available.
- No repair facility restrictions: Unlike most every other insurer, Amica has zero restrictions on which body shop you use for repairs.
- “Platinum Choice” coverage: Amica offers an additional tier of coverage called Platinum Choice, which costs more, but includes identity fraud monitoring, full glass coverage, prestige rental coverage, and rewards for good driving.
- Best array of coverages: Amica offers the most driver and vehicle coverages of all my top recommendations. Its list includes GAP insurance and interior vehicle coverage, which aren’t offered by State Farm, The Hartford, or USAA.
- Quote process is less than desirable: Whether you start online or over the phone, you will eventually wind up on the phone to get an official quote — that can tack an extra 20 to 30 minutes to the process.
- Fewer driver discount opportunities: Amica is missing a few key driver discounts, including pre-pay, low mileage, and military discounts. Consequently, it scored only 46 out of 100 in my driver discount evaluation.
- Few online resources: There are a few FAQs on the site, but Amica lacks in-depth online materials to help customers get a complete grasp on their purchases without having to talk to someone. Additionally, some policy changes require direct assistance from an Amica agent, which can be time-consuming.
STATE FARM: BEST CAR INSURANCE COMPANY FOR CUSTOMER SERVICE AND INTERACTION
State Farm is the largest car insurance company in the nation, per Insurance Journalin 2016. Fortunately, it’s also one of the best — especially when it comes to the customer service experience. In 2015, State Farm received high praise from J.D. Power for its service interaction and claims handling. And of all the insured drivers I surveyed, it received the most positive remarks by far.
It is incredibly easy to get in touch with State Farm. You can call one of the company’s 18,000 agents, go online, or even send a picture of your damaged car with your smartphone using the Pocket Agent mobile app. Compare that to Amica, which doesn’t allow you to connect with an agent via an app, or file a claim through an agent. State Farm also gets high marks for a pain-free shopping experience that lets prospective customers call their local agent or chat with a representative online if they have any questions.
- Superior claims handling: No other insurer makes it easier to file a claim — a fact corroborated by its high service rating, 18,000 agents nationwide, and excellent mobile app. Sure, most other auto insurers offer the basic trifecta of phone, app, and email contact to agents, but State Farm’s is the easiest to use by far.
- Great financial standing: State Farm has an A.M. Best outlook of stable, and a “Superior” overall rating — the highest given.
- Best online quote tool: Out of all the competition, State Farm has the simplest online quote tool. In less than five minutes, it’ll guide you completely through the process, replete with thorough examples of coverage options.
- Missing a few common driver discounts: Like Amica, State Farm lacks two extremely common discounts: pay-in-full, and automatic pay. These two discounts don’t save a ton of money, but are definitely nice options to have — and are offered by my third pick, The Hartford.
- Lacks a couple of important coverages: Unlike its competitors, State Farm doesn’t offer stacked uninsured motorist or new car replacement coverages. That could be a deal breaker for someone who lives in a state with an incredibly high rate of uninsured drivers.
THE HARTFORD: BEST CAR INSURANCE COMPANY FOR POLICY OPTIONS
The Hartford is only the nation’s 11th largest insurer, but it still packs a punch. In fact, it had the highest score in my 12-category feature evaluation (92 out of 100). It also offers a wide range of policy options and benefits (including rates based on how much you actually drive your car and a new car replacement program for cars totaled shortly after purchase) and was the only insurer to score a perfect 100 in my vehicle-discount evaluation.
- Mechanical breakdown coverage: Mechanical breakdown insurance helps cover the cost of repairs that aren’t covered by your car’s warranty. The Hartford is the only one of my top picks that includes this coverage.
- Useful policy benefits: The company provides not only a solid set of coverages, but also a great selection of policy benefits. For instance, frequent travelers will appreciate The Hartford’s towing and roadside assistance programs.
- Excellent purchase experience: The Hartford is one of two national providers to receive a perfect “Overall Purchase Experience” score from J.D. Power.
- Less-than-average claims satisfaction: The Hartford received a perfect score in my claims management evaluation, but according to J.D. Power, customers are still less than satisfied — it received only a 2-star rating for service interaction.
- Fewest online educational resources: The Hartford offers the fewest online learning materials among this field of competitors.
USAA: BEST CAR INSURANCE COMPANY FOR MEMBERS OF THE MILITARY
Throughout my research, I found that the company’s stellar reputation holds true. If you are a member of the US armed forces, or are related to one, there is no better option than USAA.
It is one of the three highest-rated automotive insurers in the country. The only downside is its limited availability: USAA only services the immediate families of active and former members of the military. Given those restrictions, the quote process is a bit more intense compared to its competitors, but that’s a small price to pay for its exemplary service.
- Rated no. 1 nationally for purchase experience: USAA received the only perfect score in J.D. Power’s 2016 report.
- Solid financial stability: A.M. Best gives USAA the highest possible stability rating: “Superior.”
- Membership restrictions: USAA is only available to members of the military and their immediate family.
- Missing three key vehicle coverages: USAA doesn’t offer GAP insurance, interior vehicle coverage, or new car replacement coverage.
1. Habitat For Humanity – Cars For Homes
Habitat For Humanity’s Cars For Homes program works directly with donors to reduce the amount of costs paid in the sale of your car donation. They typically utilize 80 percent of the proceeds of the sale of your car, with only 20 percent in costs related to the sale. Proceeds are put to use locally.
2. American Cancer Society – Cars for a Cure
Cars for a Cure is another popular choice. They sell donated cars and use the proceeds to fund cancer research. Sometimes the donated vehicle is put into use for the organization, rather than sold, and this situation can further maximize your donation because there are no costs associated with the preparation and sale of your donation.
3. National Kidney Foundation
The NKF’s Kidney Car program has been a popular donation charity, raising money for kidney disease research. Since the mid-1980s the Kidney Car program has raised more than $250 million from donated cars.
Programs vary from state to state, so researching charities before making a charity car donation will help you make the best decision and get the highest tax write off.