Guest / Limited Access /

Anyone donating a car to a charity has only days left to sign over the title before tax-law changes could reduce the value of the deduction for write-off purposes. Congress changed the law in October so that starting January 1, 2005, donors must deduct what the car actually sells for, which is usually much less than the Blue Book value donors have used in the past. Because of the change, some ministries are preparing for up to a 30 percent drop in donations.

Willow Creek Community Church's CARS ministry provides cars to people who don't have transportation. (The acronym stands for Christian Auto Repairmen Serving.) One of the ministry's selling points in its brochure is that a vehicle's "Blue Book value defines a fair tax write-off." The program's director, Joel Krooswyk, says many donations have come from people who don't want to spend the time and money selling their car and instead have claimed a tax write-off worth far more than what the car would sell for in the classifieds.

The new law requires nonprofits to provide car donors with a receipt showing how much their car actually sold for, if the value is more than $500. If the car required any repairs, the cost of repairs must be deducted from the sales value. Donors must use that figure, not the Blue Book estimate, on their tax return.

Krooswyk, along with other nonprofits, lobbied Congress to stop passage of the bill. "It's not the end of the world," he said, but he expects a 30 percent decline in income. The surpluses the CARS ministry formerly had will disappear, Krooswyk says. "We'll be a baseline organization again."

But it's hard to know what exactly to expect. Barry Kurland, general manager of Habitat for Humanity's Cars for Homes program says they have no estimates ...

Subscriber access only You have reached the end of this Article Preview

To continue reading, subscribe now. Subscribers have full digital access.

Read These NextSee Our Latest
Current IssueAjith Fernando: How Church Leaders Can Serve God's Family Without Neglecting Their Own
Subscriber Access Only Ajith Fernando: How Church Leaders Can Serve God's Family Without Neglecting Their Own
'It's a huge balancing act, and I don't think anyone in the world is perfectly balanced!'
RecommendedAmid ‘Evangelism Crisis,’ Southern Baptists Bring In $400 Million More
Amid ‘Evangelism Crisis,’ Southern Baptists Bring In $400 Million More
While the No. 1 evangelical denomination reports the highs and lows of 2015, America's No. 3 reports just highs.
TrendingWho’s Who of Trump’s ‘Tremendous’ Faith Advisers
Who’s Who of Trump’s ‘Tremendous’ Faith Advisers
The Republican candidate finally names his campaign’s evangelical connections.
Editor's PickWhen Tithing Comes With a Money-Back Guarantee
When Tithing Comes With a Money-Back Guarantee
How did churches like NewSpring and Life.Church get thousands of Christians to start giving? By offering a refund if God isn't faithful.
Christianity Today
IRS Changes May Dent Ministries' Car-Donation Programs
hide thisAccess The Archives

In the Archives

December 2004

To continue reading, subscribe now for full print and digital access.