DMV Requirements for Donating a Car

Car donation has become a popular way for charities to receive needed funds. The gift of a car not only benefits the charity but can benefit you as well. A car donation can qualify you for a tax deduction. Some charities even offer incentives such as gift cards or free trips to help encourage you to donate.

There are many factors you must consider if you choose to donate your car to charity. For instance, your ability to receive a tax deduction depends on the type of organization to which you are donating. It is also important to be aware of any state procedures or paperwork necessary to make the transaction go smoothly and legally. The following questions are offered as a guide to help you through the decision-making process.

Will I Need to Submit any Special Paperwork to Donate my Car?

The most important document in this transaction will be a clear title. There must not be any lien on the car that has not been cleared by a lender or co-owner. Be sure to note whether or not your state requires a title to be notarized before it is transferred. Charities that regularly receive cars as donations will have systems in place to make the title transfer process easy.

Should I Remove the License Plates from the Car?

While some states require the removal of plates from a donated car, it is a wise idea to do so even in states where it is not. The removal of the plates will reduce the possibility of fraud and of you accepting any liability if something should happen to the car.

What if I Own the Car but Do Not Have the Title?

In the event you have lost or misplaced your title, contact your local DMV office to learn their procedures for acquiring a replacement title. If the car is owned by you but not titled to you, the DMV office can give you instruction on how to perform a title transfer.

Does the DMV Need to be Notified When I Donate My Vehicle?

Check the rules for your state. Every state has its own specific list of procedures concerning car donation. These can include necessary paperwork, removal and return of license plates, transfer of title, etc. Even if it is not a state requirement, communicating to the DMV that you have donated your car will help in releasing you from any future liability associated with the car.

Are There any Other Steps I Should Take Once the Car has been Donated?

Make sure to cancel your registration. This will be another step in removing you from the ownership of the car and reducing the chances of future liability associated with it. In some states, if the registration has not expired, you may be eligible for a refund. You will also want to make sure to cancel your insurance. What is the point of receiving the benefit of a tax deduction if you have spent all of those dollars insuring a car you no longer own?