Check Charity Status

• Donating a car can be a smart financial move because you are allowed to use it as a tax write-off. But you need to properly transfer the title and keep a record of your transaction to be able to get the write-off that saves money on your taxes.
  
  Before doing anything with your car's title, check to make sure that the charity you are donating to has the proper nonprofit status. For tax purposes, you may only deduct donations to 501(c)(3) charities. Donating to nonprofits with the ability to lobby the government who have a designation of 501(c)(4) will not result in a tax benefit, according to CharityNavigator.org.
  
  

Reassigning Ownership

• When you sell or donate a vehicle, the assignment of ownership must be filled out on the back of the title. Always wait to fill it out once the donation has been made and you can verify the exact name and address of the nonprofit recipient.
  
  Sign the title assignment exactly as you did when you received the title yourself. In some states you may even have to get your signature notarized. Check with your state's bureau or department of motor vehicles. You will also need to fill in the odometer reading at the time of the transfer of ownership as well as the selling price, which in the case of a donation should just read "charitable donation".
  
  Failure to fill out the assignment of ownership will mean that the car still belongs to you in the eyes of the law, according to CharityNavigator.org. If a donated car acquires traffic tickets or is used in a crime at a later date, the car could still be traced back to you and liabilities could result if you haven't properly transferred the ownership.
  
  If a charity organization asks you to leave the assignment of ownership blank, then you should give the car to a different charity that does not ask this of you.
  
  

Income Tax Filing

• When you no longer have the car and you're sure the title has been changed to reflect that you are no longer the owner, at tax time you can fill out tax form 8283 for non-cash charitable contributions if you will make a deduction for more than $500 for your car, according to the IRS.
  
  If you will deduct more than $5,000 for your car donation, you should have the car appraised and the tax form will need to be signed by the appraiser.