Friday, December 8, 2017

THE NEWS OF HAPPINESS CAME TO THE BANK'S ACCOUNTANTS, AS DID JAITLEY HIMSELF.

Education is an important medium of acquiring skills and knowledge. Our education begins at home. Thereafter, as we grow we go to schools, colleges and other educational institutes.



t'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. But if you want to maximize your tax benefits, it's more complicated. Here's a walk-through of some of the considerations, with the usual proviso that you should discuss these issues with your tax preparer before you act.
You Must Itemize Your Return
If you want to claim a car donation to reduce your federal income taxes, you must itemize deductions. You could itemize even if the donated auto is your only deduction, but that's usually not the best choice.
Here's the math: Suppose you're in the 28 percent tax bracket and the allowable deduction for the vehicle's donation is $1,000. That will save you $280 in taxes. If you're in the 15 percent tax bracket and you get that same $1,000 deduction, it will reduce your taxes by $150.
If the car donation is your only deduction, it's likely that taking a standard deduction would save you thousands more dollars in taxes. The only way that donating a car nets you any tax benefit is if you have many deductions and if their total, including the car, exceeds the standard deduction. And remember, you can always donate as much as you want to charities, but the IRS limits how much you can claim on your tax return.
The Charity Must Qualify
Only donations to qualified charities can provide a tax deduction for you. A qualified charity is one that the IRS recognizes as a 501(c)(3) organization. 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 to use the IRS exempt organizations site, or call the IRS toll-free number: 877-829-5500.
A Key Concept: Fair Market Value 
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." In this scenario, neither the buyer nor the seller can be an auto dealer. Both must be private parties.
What complicates the matter for taxpayers is that under current IRS rules, you can only deduct a vehicle's fair market value under four very specific conditions:
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 "significant intervening use of the vehicle." This means the charity will use the car in its work.
3. When the charity intends to make a "material improvement" to the vehicle, not just routine maintenance.
4. When the charity gives or sells the vehicle to a needy individual at a price significantly below fair market value.